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Cohabitation Agreement Upheld: S. 93 Family Law Act

Cohabitation Agreement Upheld- S. 93 Family Law Act

In Hudema v Moore 2021 BCSC 587 the parties signed a cohabitation  agreement between themselves that while they cohabited, the relationship would NOT be defined as marriage like, the court reviewed S. 93 Family law act and  upheld the agreement.

The male partner had brought an action under section 93 (3) and 93 (5) of the Family Law Act based on unfairness and misrepresentation of the “true” purpose of the agreement.

The court held that the Agreement was not substantively unfair, and there was no basis to set it aside under s. 93(5) of the FLA

S. 93 Family Law Act

(3) On application by a spouse, the Supreme Court may set aside or replace with an order made under this Part all or part of an agreement described in subsection (1) only if satisfied that one or more of the following circumstances existed when the parties entered into the agreement:

(a)a spouse failed to disclose significant property or debts, or other information relevant to the negotiation of the agreement;
(b)a spouse took improper advantage of the other spouse’s vulnerability, including the other spouse’s ignorance, need or distress;
(c)a spouse did not understand the nature or consequences of the agreement;
(d)other circumstances that would, under the common law, cause all or part of a contract to be voidable.

(4)The Supreme Court may decline to act under subsection (3) if, on consideration of all of the evidence, the Supreme Court would not replace the agreement with an order that is substantially different from the terms set out in the agreement.

(5)Despite subsection (3), the Supreme Court may set aside or replace with an order made under this Part all or part of an agreement if satisfied that none of the circumstances described in that subsection existed when the parties entered into the agreement but that the agreement is significantly unfair on consideration of the following:

(a)the length of time that has passed since the agreement was made;

(b)the intention of the spouses, in making the agreement, to achieve certainty;

(c)the degree to which the spouses relied on the terms of the agreement.

Mr. Hudema voluntarily chose to sign the Agreement and was not coerced into doing so. While there was no certificate of independent advice signed, Mr. Hudema did have an opportunity to consult with a lawyer before signing. His decision to sign the Agreement was an informed one.

The court concluded there was no procedural unfairness in the process by which the Agreement was signed, and no basis to set aside the Agreement, in whole or part, on any of the grounds listed in s. 93(3) of the FLA.

Unfairness

Mr. Hudema alternatively argues that the Agreement should be set aside pursuant to s. 93(5) because it is significantly unfair in its terms. The issue of whether the terms of the Agreement are significantly unfair turns on a consideration of the factors listed in s. 93(5)(a)-(c) of the FLA, including the length of time that has elapsed, the intentions of the spouses in making the agreement, and their reliance on the terms of the Agreement.

This is not a case where circumstances have changed since the making of the Agreement such as to undermine the parties’ intentions in signing it. The parties’ relationship ended just over a year after the signing of the Agreement.

There is no evidence that their financial circumstances substantially changed over the course of that year. Mr. Hudema simply regrets his agreement and wants to be released from it.

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