Co-ownership Agreement

February 2023 – Co-Ownership Agreements What are They & Why Do you Need One?

Co-Ownership Agreements

Many people think that dealing with real estate contracts is hard work. No matter what kind of property you are dealing with, or if you are buying, selling or renting a place, there is always some level of stress in the air, and the fear that something so important such as it may go terribly wrong. 

Among those fears, there are financial matters, problems with documentation that may not be in accordance with regulations, issues with contracts settled with other people, and many, many more. This is why most people choose to hire lawyers from the beginning to assist them. 

In many cases, lawyers in Calgary will suggest that people settle co-ownership agreements regarding the new property they are getting. To the average person, this concept may lack meaning, so it is essential to get to know it.

What Are Co-ownership Agreements

Simply put, a co-ownership agreement is a contract settled between two or more people who intend to share a property. The reasons behind those are multiple, varying greatly from business reasons to simply being married to someone else. 

For that reason, the structure of a co-ownership agreement calgary is also personalised depending on the needs of the parties. Aside from basic information such as the owners’ names and a description of the property, the first and most important thing to include in a co-ownership agreement is the ratio to which each of the owners is entitled. Not everyone will agree on splitting the real estate in half on a 50/50 ownership percentage, and this must be talked through extensively. 

Lawyers, in those cases, can work as mediators between the parties and establish an agreement in which everyone is as satisfied as possible. In other words, even if two people settle for a 40/60 ratio, the person who owns 60% of the property could also be the one responsible for most of the maintenance if the parties find it fair to do so. 

Derivative from the ratio, the next most relevant topic to include in the agreement is the financial contribution from each party. Those who own a bigger slice of the property will also be the ones putting more money into it unless otherwise specified. Alongside the amount of money to be invested in the property, there are also the concerns of where the money is going to come from, and what shall be done if one person or another is not able to fulfil their responsibilities. Any issues about mortgages must be thoroughly discussed with the parties’ lawyers, and included in the co-ownership agreement. 

Moreover, the agreement is also where the people involved would describe everyone’s responsibilities and rights regarding the property. Matters such as land maintenance, living expenses, property usage, etc., should all be described in the terms of the agreement, in order to make it clear to everyone what they can or cannot do while sharing the real estate. This is especially relevant if one of the parties wishes to put their share of the property out for rent while other co-owners are still living there. In the event of them being allowed to rent, the terms of the co-ownership agreement must include which parts of the property the future tenants can have access to (common areas, backyards, parking spots) and what is to be done with the payment of rent (if it is going to go exclusively to the owner renting out or if it is going to go to expenses’ payment). 

Finally, the co-ownership agreement must include terms regarding disputes and any exit of the contract. In case the owners disagree on their rights and responsibilities regarding the property, how would they settle things down? Would they ask the same lawyer to mediate their conflicts, hire other ones or take the dispute to a court of law? And what if someone wishes to exit from the contract? Can they sell their part to the other people involved, or must they find someone else to enter the agreement in their place? All of this should be outlined in the terms for future use and consultation.

Many other terms can be included in a co-ownership agreement. You, and the other co-owners, must ask your lawyer about it and shape the contract in a way that fits everybody as much as possible since this agreement is binding.

Why Do You Need One?

Now that we have explored what is a co-ownership agreement, the only thing left to do is answer the question: Do you really need one? 

The short answer is no, you do not need a co-ownership agreement in the same way that you do not need to have your will written down, but there is no doubt that getting one is the smartest thing to do in many cases. 

Couples can benefit from co-ownership agreements by having security that, in case any of them file for divorce in the future, their share of the property will be protected. It is also helpful that they can guarantee that both of them will have equal rights and duties regarding the house, and so every decision in the future such as renovations, renting or selling, etc will have to be taken mutually. 

This kind of agreement, however, is more common between friends or business partners. People who intend to live with their friends, but not use the property for any commercial ends, may be interested in getting a co-ownership agreement to outline exactly what is everyone’s roles in the household, especially when money is involved. 

By not having emotional attachments in the same way as couples do, friends can often rely on the written terms of the contract to settle down conflicts between them. But it is not only during hard times that the agreement is useful to friends: by setting up one when buying real estate together, friends can make a statement of trust between them, and help smooth things out from the start. By knowing each other’s rights, the conviviality in the household can only increase for the better. 

It is for business partners that a co-ownership agreement is the most interesting. Because the property is going to be used for commercial goals, there are even more details to be included in the terms, like the kind of operation that they will run on the property. Out of all possibilities, business partners are the ones most likely to have conflicts regarding their ownership, so having a co-ownership agreement is essential. 


In general, co-ownership agreements exist to help people out and avoid future conflicts. More often than not, people ruin their personal relationships over things that could have been settled long ago, and it is in no one’s interest that things end so. If you are planning to share a property with a spouse, friend or business partner, you should ask your lawyer about co-ownership agreements.

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