You would think, wouldn’t you, that nothing could throw a wet blanket over a flourishing romance half as reliably as a prenuptial contract or – in the case of gays and lesbians – a domestic-partnership contract. Yet over the past several years the numbers of such contracts has soared. Is this because couples have more assets to worry about in this flourishing economy, or is it because they take a more realistic view of the longevity of many relationships, hetero or homo?

Regardless of their motivation, gays and lesbians have stronger reasons than heterosexuals for considering a domestic-partnership contract. When a heterosexual couple decides to divorce, a judge will supervise the division of assets so as to prevent gross exploitation of one party by the other. But in almost every state, homosexuals lack such protection. Although a domestic-partnership contract does not have legal standing everywhere, however, in a number of municipalities it can be registered and can, as we shall see, serve as evidence of a long-standing relationship.

But conflict between partners need not reach a critical state for a domestic-partnership contract to be useful. Reducing issues of "who does what," "who pays for what," and "who inherits what" to writing can often avoid disagreements entirely or settle them before they flare up. And such a contract can be especially useful if a catastrophic illness or accident should disable or kill one of its signatories.

There is no specified form for the domestic-partnership contract – and its content will depend entirely on the dimensions of the relationship. Usually it deals with the rights and duties of each party (though sexual services should never be specified lest the contract be thrown out of court). If children are involved, it should spell out custodial arrangements.

Money and Property

The agreement should specify in detail:

• Which assets belong to the couple jointly and which are to be retained by the individual (usually those that were acquired before the union).
• The management and use of joint bank accounts.
• The division of proceeds of rental property owned by both partners.
• The disposal of assets on the death of either partner.
• The use of a jointly purchased vehicle and the terms of its disposal, since it cannot be split if the partnership is terminated.

Health, Medical Care and Death

In the absence of an advance directive, the agreement should specify:

• Authority of one of the partners to make health-care decisions for the other in case of a partner’s incapacity
• Visitation rights at hospitals and nursing homes.
• The authority of a partner to choose, on behalf of a deceased partner, funeral rites and method of body disposal.
• Each partner’s rights to a cemetery plot.

Dispute Resolution

It would be useful, too, at a time when no dispute is foreseeable, to specify: 

• An agreement to use arbitration or mediation rather than litigation to resolve any disputes that arise during the partnership or after a break-up.
• An agreement about a cooling-off period before termination of the partnership.

The Legal Status of the Contract

Although a growing number of municipalities permit the registration and enforcement of domestic-partnership contracts, in most situations these contracts have no legal standing and hence are usually not enforceable. Thus, domestic partners cannot file for divorce or readily go to court to resolve issues of child custody, visitation, and support.

Some courts, however, follow the three principles established in the widely publicized case of Marvin vs. Marvin – namely, that unmarried couples may make binding written or oral contracts, and that where no express contract exists, a court may examine the relationship to determine whether an implied contract exists.

Since the Marvin decision, most courts have enforced written contracts, been divided in cases involving oral contracts and rejected implied contracts.

Getting Started

It is unusual for both partners to approach the prospect of a domestic-partnership contract with equal levels of enthusiasm. One of the partners is almost certain to feel that a written contract signifies mistrust, a lack of spontaneity, or – at best – the end of romance in the relationship. Often the best way to achieve a contract is to approach it in several stages – beginning with a casual mention and leading up gradually to a discussion of contract terms. In some situations, the involvement of a third party – preferably someone who has a contract of his or her own – may facilitate matters.

Do it Yourself or Get Help?

Once general agreement has been reached, the contract can be signed. But if the partners’ possessions are substantial or complex – involving real estate, a portfolio of investments, a business or an array of pension plans or insurance policies, consultation with an accountant or a lawyer skilled in estate planning may be useful.

Writers: Theodore E. Hughes and David Klein

This article is based on material published in Theodore E. Hughes and David Klein's book "Protecting Your Money" (Alyson Books, $14.95).