For many couples marriage is not necessary. People cohabit in a relationship like a marriage, but the legal marriage has not occurred. Children are born and the parties expect the relationship to last.
With the high divorce rate, some people say that marriage does not guarantee that the parties stay together. It does not, but there is a difference between marriage and living together in the financial rights and responsibilities of the parties. When parties split up, both in a marriage and without a marriage, the economic impact becomes very important. If one party was financially dependent on the other, finances after the breakup are critical.
People who contributed to the relationship such as caring for children and housekeeping expect a payback for what they have done. In 2010, the New Jersey Legislature passed a bill requiring that Palimony agreements must be put in writing to be enforceable and that both parties must be represented by counsel in drawing up the Agreement.
After January 18th, 2010, it is not legally sufficient for a Palimony agreement to be verbal. If a couple started to cohabit after 2010 they need a written Palimony agreement. However, if they were cohabiting before 2010 the written Palimony agreement is not required if the promise to support was made before January 18th, 2010. This must be proven. A general promise of support for life made by one party to the other for some consideration in exchange may suffice to form a contract.
Parties living together may enter into lawful agreements with one another if one party induces the other to remain in the relationship by a promise of support made in writing. The agreement – called a Palimony agreement – is enforceable in Court. It is a contractual right. Agreements before January 18, 2010 may be determined by the parties’ acts.
The requirement for a written Palimony agreement after January 18, 2010 is a new provision of the Statute of Frauds. Because the U.S. constitution forbids passing any law which impairs the obligations of contracts, the law could not be applied retroactively. Therefore, if there was an oral Palimony agreement before January 18th, 2010 it may be upheld.
Caution must be used however. Just because one party alleges there was an oral agreement for support the burden is on the claimant to prove it. The rights that arise do not come from the relationship. Just because there is cohabitation does not mean a contractual right of support exists. There needs to be a promise for support for life in exchange for certain contributions to show there was a Contract. The parties acts, conduct and circumstances are elements that are looked at to substantiate claims. There are significant differences in the inheritance rights between married people and couples who do not marry as well as Social Security and dependency benefits which are limited to children, spouses, and divorced spouses.
If a divorced spouse was married for ten years and divorced for two years, one can claim a personal Social Security benefit based on an ex-spouse’s earnings record. One’s ex-spouse has to be at least 62 years of age and capable of receiving benefits. He/She does not have to be collecting Social Security benefits.
The bottom line is that a marriage, or a relationship tantamount to marriage, both have financial implications. Each relationship will involve issues of financial responsibilities during the relationship and afterward. It is advisable to identify one’s expectations.