Cohabitation Agreements: What You Need To Know Before Moving In
- Scott Green
- 13 minutes ago
- 4 min read
Taking the next step and moving in with your partner is an exciting milestone. But while you’re planning furniture layouts and Netflix marathons, don’t overlook the legal side of things, specifically the benefits of a cohabitation agreement.
We understand that it’s not romantic to think about a relationship breakdown. But protecting yourself emotionally and financially is one of the smartest things you and your partner can do to protect yourselves.
What Is A Cohabitation Agreement?
A cohabitation agreement is a type of Binding Financial Agreement (BFA) under the Family Law Act 1975. It outlines how you and your partner will divide property, superannuation and other assets if your relationship comes to an end.
Cohabitation agreements can be entered into:
Before getting married (sometimes referred to as a 'pre-nup')
While married or in a de facto relationship
While separating from a spouse (before applying for divorce)
After a de facto relationship breakdown or divorce
Cohabitation agreements can be used i all types of relationships regardless of age, sexuality or wealth, but are particularly valuable when:
One partner has significantly more assets
You or your partner have children from a previous relationship
You' re approaching retirement or considering aged care living
Are Cohabitation Agreements Legally Binding?
Yes, but only when properly drafted and executed.
There are strict requirements which must be met in order for a cohabitation agreement to be legally binding:
The agreement must be signed and dated by both parties
Both parties must receive independent legal advice on their rights and obligations
Both parties must obtain and exchange a statement from their legal adviser confirming that advice was given
As a cohabitation agreement is a legally binding document, it’s essential that it is drafted by a qualified and experienced family lawyer. These agreements are complex and must meet strict legal requirements to be enforceable.
Attempting to draft one yourself may lead to serious consequences, and poorly worded or unfair agreements may be set aside by the courts, particularly in cases involving duress, fraud, or unconscionable conduct. That’s why we strongly recommend engaging a reputable lawyer early in the process to ensure your agreement is properly prepared, and is fully compliant with the requirements.
To learn more about the strict requirements, we recommend reading our in-depth article about Binding Financial Agreements by clicking here.
A landmark Australian High Court case Thorne v. Kennedy highlighted how these types of agreements can be overturned and set aside by the courts when these requirements are not met.
What Should A Cohabitation Agreement Include?
Your cohabitation agreement should reflect your unique circumstances, and can cover as little or as much as you and partner would like.
Many cohabitation agreements will cover things such as:
Assets brought into the relationship and whether they will remain separate
Future inheritances, such as family businesses or property
Joint property, including how it will be owned, divided, or sold
Financial contributions
Contingency plans for major life events, such as children, death or incapacity
For example, if one partner owns the house solely in their name, a cohabitation agreement can clarify what will happen to it if the relationship ends. This avoids later disputes, and ensures both parties are 'on the same page' from the outset.
It’s also worth noting that if both parties agree, they can enter into a termination agreement to formally bring the Cohabitation Agreement to an end should they wish.
De Facto Or Married? What Are Your Property Rights
In Australia, de facto couples generally have similar property rights to married couples. However, the key difference is that de facto couples must prove the existence of their relationship before accessing those rights.
The court considers several factors when determining whether a de facto relationship existed under Section 4AA of the Family Law Act 1975, such as:
How long you’ve been together
Whether you lived together
Financial arrangements and dependence
Ownership of property
Commitment to a shared life
Whether you have or care for children together
Importantly, even if you’re not living together for the duration of your relationship, you could still be considered de facto under the law, and your property may be at risk of dispute.
Cohabitation agreements may not be appropriate for every couple entering a marriage or de facto relationship, whether due to personal beliefs, religious values, cultural considerations, or other individual circumstances. We would always recommend speaking with a lawyer so they understand your unique relationship and preferred outcomes, and provide the appropriate advice. That's why we offer a free no-obligation 30 minute consultation for all new family law clients.
Can My Ex-Partner Make A Claim On My Property?
Yes, if certain conditions are met.
A former de facto partner may be able to make a claim for a property settlement if:
The relationship lasted for at least two years
You share a child
One partner made substantial contributions (financial and/or non-financial)
The relationship is registered
If a claim proceeds to court, the process can be stressful, costly and time-consuming. The court will assess contributions, identify the property pool (the assets you and your partner own), and determine a division under the Family Law Act 1975.
A well-drafted cohabitation agreement generally allows you to avoid costly disputes and/or court entirely, giving you and your partner a fair and agreed-upon agreement.
Don’t Wait Until It’s Too Late
Talking about a cohabitation agreement now is the best way to avoid conflict and disputes later. It gives you both clarity, peace of mind and legal protection in the event of a separation.
At RHC Solicitors, our experienced family law team can help you create a tailored binding cohabitation agreement that meets all legal requirements and protects your interests.
Disclaimer: This publication is not intended to be comprehensive, nor does it constitute legal advice. We are unable to ensure the information is current and there is no guarantee in relation to accuracy. You should seek legal or other professional advice before acting or relying on any of the content of this publication. The views and/or opinions expressed in this publication is that of the author and may not necessarily represent the views and/or opinions of RHC Solicitors.
RHC Solicitors ©
