Cohabitation Agreements

California does not recognize community property rights between cohabiting couples and does not recognize “common law marriage”, and therefore does not protect those who opt out of traditional marriage or registered domestic partnerships. There are no automatic property rights or support rights under the California Family Code for unmarried cohabitants. Though there may be judicial recognition and enforcement of express or implied agreements between unwed cohabitants, such as breach of contract, partnership theories, constructive trust, declaratory relief, specific performance, quantum meruit and other equitable remedies, the legal process to obtain such recognition is likely to be emotionally torturous and very costly in the absence of a clear, written agreement.

Therefore, it is important for unmarried couples living together to discuss and reach agreements on financial and property rights if the relationship ends. These agreements should be reflected in a cohabitation agreement and testamentary documents such as wills or trusts.

Palimony is a combination of the words pal and alimony coined by celebrity divorce attorney Marvin Mitchelson in 1977 when his client Michelle Marvin (Marvin v. Marvin, 8 Cal. 3d 660 (Cal. 1976) filed an unsuccessful suit against the actor Lee Marvin. Palimony is a popular term, not a legal term, and is often used to describe the division of financial assets and real property when parties end an unmarried domestic relationship. Unlike alimony or spousal support, which is often provided for by law, palimony is not guaranteed to unmarried partners. There must be a clear agreement, written or oral, by both partners stipulating the extent of financial sharing and/or support in order for palimony to be granted. Palimony cases are determined in civil court as a contract matter, rather than in family court, as in cases of divorce.

In 1971, Michelle Marvin claimed that Lee Marvin, who was still married to someone else at the time they began living together, promised to support her for the rest of her life. In the end, in Marvin v. Marvin, the California Supreme Court ruled that Michelle Marvin had not proven the existence of a contract between herself and Mr. Marvin that gave her an interest in his property. Thus, the common law rule applied and she was only entitled to the property that she brought to the relationship.

The Court explained that while the state abolished common law marriage in 1896, California law recognizes non-marital relationship contracts. These contracts may be express or implied, oral or written–but either way, they must be provable. Michelle Marvin did not meet her burden of proof. The contract may also provide for a sexual relationship as long as it is not a contract for sexual services. Eventually, the California Court of Appeal ruled that since Michelle and Lee Marvin never had a contract, she was not entitled to any money.

Consequently, cohabitation agreements are important and are particularly important if one or both has significant assets or debts, owns a property or business, or has children from a previous relationship. In addition, a cohabitation agreement can provide clarification and understanding on issues such as how income and expenses are handled and provide clarity on division of property and support if the relationship ends. This is especially important if there is an income disparity or if one person is sacrificing income to raise children.

For example, one partner stays at home to raise children while the other earns a substantial income and acquires significant assets during the relationship which ends. A married partner in California has the community property law of equitable distribution to protect her interest in half of the assets earned and the right to spousal support. The unmarried partner has nothing except for the ability to obtain child support if the children are still minors.

In addition to the legal protection provided by unmarried partners setting forth their rights and obligations in a cohabitation agreement; the process of creating the agreement provides an opportunity for couples to discuss the role of money in their lives gain clarity and understanding that benefits the relationship.