Do you assume the house or cottage you share with your life partner belongs to both of you, or are you positive you understand who holds legal ownership? Assumptions can be expensive when it comes to money and real estate.

"The garden is as much mine as yours," yelled one homeowner to his spouse when their landscaping discussion got heated. This retort cooled tempers, and they agreed that since they share the house, they should share the garden. But are they legally co-owners? When disagreements can be settled amicably, legalities carry less weight. When selling or financing a property, or if separation or divorce are the issue, legalities rule.

If the couple above contributed equally to the purchase and share expenses, maintenance, and upgrades equally, and both names are on title as registered owners, they probably do both own the real estate. Neither can mortgage or sell the property without the other's written agreement. However, legal issues of ownership are so complex that nothing can be assumed when it comes to who owns what.

"What often happens is that people go along, and they don't think through the legal implications: What if this relationship comes to an end?," said Kelowna-based lawyer Stan Rule of Sabey Rule LLP. He acknowledges that, during his work with estate litigation and will disputes, he sees expensive ramifications of acting in haste instead of continually clarifying ownership issues.

Rule described cases where parents had lent money to a child intent on buying real estate with a significant other, and others where parents had allowed the child and partner to build on the parents' property without documentation to cover what should happen if the relationship ended. Just as parents need to be protected with an express agreement, like a second mortgage, describing "what if" possibilities, so do their children need protection for their real estate investment.

Although cohabitation agreements and pre-nuptials are more common, too often they are not kept up to date over the years. Nor do the individuals track their finances and contributions. Rule related an estate case where a personal journal documenting ownership substantiated a legal claim. Keeping good financial and ownership records provides solid ground for future claims.

Rule suggests that for most couples, the answer is to register both their names on title. He has clients who go a step further and opt for ownership as joint tenants, so, if one dies, title passes to the survivor, instantly and automatically.

"Unjust Enrichment in Joint Family Ventures" To start with, let's clear up two common misconceptions:

1. Real estate is owned with undivided interest, that is, no legal owner can point to one corner of the lot or to one room and say, "I own that and the other owners don't." When multiple owners share a cottage or property with designated personal zones, they are smart to do so in a written agreement since in law what's mine is everyone's.

2. In divorce and division of property settlements, it is the value of the property, not the property itself that is divided between spouses.

Provincial family law stipulates that the value of property, including real estate, accumulated during the marriage is subject to equalized distribution, with some exceptions. Make no assumptions here. Check with a lawyer experienced in this area of law to learn how the details for your province and your type of relationship add up to ownership.

If both partners are on title, they may never end up in court arguing for a share. Common law relationships, no matter how like marriage they seem, do not offer the same rights and rules as marriage. There is no automatic right to share the value of real estate or other property, even though the popular misconception is that it's a 50:50 relationship.

The recent Supreme Court of Canada judgement Kerr v. Baranow made a significant contribution to fair determination of unjust enrichment in what is termed a "joint family venture," that is "working collaboratively towards common goals" outside of marriage. If you currently own property with a partner, or intend to, understand your rights and options:

• Stan Rule's blog The Rule of Law is a good starting point. Rule explains that provincial family laws dictate rights of ownership for married couples, but resolution of real estate disputes between unmarried co-habitants may be based on unjust enrichment. This means that, while one may have contributed more financially to the purchase and maintenance of the real estate, the other's contributions of labour or money in the management and operation of the family may have enriched returns for the partner, at their own expense. Both parties could also claim unjust enrichment against each other.

  The responsibility of assigning monetary value to the contributions and losses of each party falls to the courts. Proving the value of one person's years of contribution requires evidence of benefit. For instance, one partner may have stayed home to focus on family while the other built a successful career or business. Evaluating domestic services, child rearing, and other contributions remains a challenge. Since these are often seen as low-paying jobs, the fairest calculations include a share of real estate appreciation. A judgement in favour of the giver of benefit, means the other must pay, and perhaps, give up an interest in the property.

• Ontario-based Osgoode Hall Law School's The Court, an "online resource for debate & data about the Supreme Court of Canada," offers a different perspective on the case in "No pre-nup? In Ontario, common law relationships involve two people of the same or different sex cohabiting for 3 years, or with a child and a "relationship of some permanence." This article discusses the two legal common law options for dispute resolution in Canada: the resulting trust and the action in unjust enrichment. "A big question to ask with respect to the different treatment between married couples and common law couples is why these differences even exist? On what sound basis should the rights of married persons be put above the rights of common law couples?"

• Divorce.ca offers both non-legalese articles and lawyer contacts on a number of real estate related issues, from most provinces. Many legal firms offer plain-language content on their sites. While short lists of points are useful to get you started. To fully understand legal topics, clearly written, plain-language explanations of "so what?" and "what do I do about it?" issues behind topics are essential.

Rule's "rule of law": "In law, there are competing interests. If you are not on title, then you are out of luck, and that causes uncertainty. You lean towards fairness, and there is less certainty."

PJ's rule of law: "Assumptions are expensive." Ask real estate and financial professionals to explain ownership status and implications, but seek legal advice when you must know exactly who owns what.

Published: April 5, 2011

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Futurist and Strategist PJ Wade is "The Catalyst" - intent on "Challenging The Best to Become Even Better." PJ earned this title by translating the dynamic impact of Boomers and their multi-generation families into relevant insights that start people thinking and taking action—in business and in life. Author of 8 books and more than 1800 published articles, PJ encourages individuals to become their own futurist. PJ writes and speaks about the insight, knowledge and solid decision-making skills that professionals and their clients need to live and work in this vortex of change. For instance, since PJ knows that home is headquarters for the new decades-long "unretirement," she wrote the popular book "Reverse Mortgages: Best Friend, Worst Enemy...Your Choice!", which is filled with suggestions and cautions on protecting, building and managing home equity. Her new business book, "What's Your Point?: Cut The Crap, Hit The Mark & Stick!" will be published in 2012. As The Catalyst, PJ provides strategic communication, client appreciation and advanced education services to the financial, tourism, lifestyle and service sectors - and the clients they serve. A frequently-quoted financial and business commentator, PJ is a thought-provoking strategic speaker who offers practical, real-life suggestions on leaving "the box" behind and embracing Forward Thinking - a talent she regularly demonstrates in this column. For more on keynotes, blogs, books and information on a range of 21st-Century topics, visit TheCatalyst.com.