Living Together Agreements: Equitable Disribution by Contract
An article in today’s New York Post reported on federal statistics showing that the divorce rate in the United States gas fallen to the lowest level since the 1970’s. While this information had first been reported over a week ago by the Post and other major media outlets, there is an interesting aspect of the article which deserves some additional attention.
The article quotes Raoul Felder as stating that he has drafted what he calls “living together agreements” for unmarried couples living together which spell out who gets what assets in the event of a break up.
This type of agreement is essentially a post-nuptial agreement for an unmarried couple. It is based on the general law of contracts and is informed (but not necessarily governed by) the Domestic Relations Law. For owners of businesses and professional practices who are living with someone to whom they are not married, these types of agreements should be considered as one way to deal with some very complex legal issues surrounding the rights of their current partner regarding the business or professional practice.
A carefully crafted ‘living together agreement’ should address the amount of money that should or could be awarded to the partner of the professional or business owner on account of the increase in value of the business or practice during term of the relationship. Also, the agreement should specify the conditions under which such a payment would be made, the method of payment, and the manner in which the payment would be calculated. In effect, this agreement would be a privately negotiated form of equitable distribution.
I am not aware of any case in New York which has interpreted such an agreement. If you know of such a case, please let me know and send me a copy of the decision if at all possible.
