HOUSEHOLD MANAGEMENT AGREEMENT SAMPLE ... - USA Today

HOUSEHOLD MANAGEMENT AGREEMENT SAMPLE PROVISIONS You should consult a competent estate planning attorney familiar with the issues unique to same-sex couples in the state where you live. If the laws of your state allow for the enforcement of domestic partnership agreements between unmarried persons, the following provisions are designed to provide you with ideas for some of the topics that you might want to cover in your own agreement. PERSONAL PROPERTY All personal property brought to this household by either party shall remain the personal property of each party. In the event of dissolution of the household, each party shall be entitled to his own personal property. These items shall not be considered joint, nor transferred to the other except by a writing signed by both parties. Lists of each party’s separate property are attached. REAL PROPERTY On or about ___________________, the property known as _____________________ was purchased in the name of the parties. The purchase price for said property was $_________________. A copy of the deed, mortgage and note are attached. The parties acknowledge that the down payment was made equally. There is a first mortgage in the amount of $_________________ as financed by _______________________ and a homeowners’ equity credit line from ________________ which currently has a balance of $_____________. The parties made extensive improvements to the property after its acquisition which were paid for equally; it was appraised as having a value of $_______________ in ______________. The parties agree to make all payments related to the property when due, equally, including payments of principal, interest, taxes, insurance and utilities. HOUSEHOLD ACCOUNTS AND EXPENSES The parties shall maintain a joint checking account out of which all household-related expenses, including but not limited to mortgage payments, home equity loan payments, home insurance premiums, taxes and home improvement costs shall be paid. The parties shall contribute to the joint checking account equally. In the event of dissolution of the household, this account shall be maintained for a period of ninety (90) days in order to facilitate a transition. No party shall deplete these funds or withdraw sums for any expenditure unless they are expressly for the household. After paying any outstanding debts, this account shall be closed and the remaining amount split evenly between the parties.

FUTURE RENOVATIONS OR CAPITAL IMPROVEMENTS Any capital improvement desired by either party shall be decided upon jointly by the parties and shall be paid from the household account or the homeowners’ equity line. For purposes of this Agreement, any repair over the amount of $_______ shall be considered a capital improvement, unless the parties otherwise agree. Both parties must agree before any nonemergency repairs costing more than $________ may be performed. Emergency repairs may be authorized by either party. Either party may unilaterally improve the property on his own, but any such improvements shall become a part of the property for the benefit of both, unless otherwise agreed in writing. DISSOLUTION OF HOUSEHOLD AND SEPARATION If either party wishes to dissolve the household, he shall give the other party three (3) months’ written notice of his intention to do so. Notice of dissolution may be withdrawn by mutual written consent. During the three month notice period, each party agrees not to disrupt the household and shall not take with him any personal property except clothing and necessities, nor shall either party destroy any personal property. Either party shall continue to have access to the household, but shall not be accompanied overnight by another person. Neither party shall change the locks on the residence, nor shall either party attempt to interfere with the liberty of the other during this transition period. Each party shall continue to contribute to the Household Account and be responsible for the payment of household expenses, unless otherwise agreed. BUY-OUT UPON SEPARATION It is not contemplated by the parties that the house will necessarily be sold to a third party upon dissolution of the household. Rather, one party shall have the right of first refusal to purchase the other’s share. If one party purchases the other party’s share of the property, the price of said share will be determined by obtaining an appraisal by a licensed professional. The costs of obtaining such an appraisal shall be shared equally by the parties. The appraisal shall be at Fair Market Value (FMV). The FMV less secured debt and outstanding prorated taxes shall be the Net Value (NV). The NV divided by two (2) shall be the purchase price of the other’s share. If a party’s purchase price as calculated by the foregoing shall be a negative value, then the other party shall be required to pay the purchasing party an amount equal to the absolute value of the negative purchase price. The purchasing party shall make every effort to re-finance any existing mortgage or home equity loan in order to remove the other party’s name from all obligations. If re-financing is not possible, the purchasing party shall indemnify the other party from all obligations related to any mortgage or home equity loan, real estate taxes and property related expenses. If neither party is able to purchase the property, the property shall be sold on the open market at the highest FMV. The net proceeds, if any, shall be divided 50% to _________ and 50% to 2

_________, after first repaying any outstanding mortgages, the home equity line and salerelated expenses. If both parties are willing and able to purchase the house, or if the parties are unable to agree on any aspect of the disposition of the property, then both parties agree to engage the services of a mutually-agreeable mediator to assist them in resolving such a dispute. If the parties are unable to reach an agreement through the mediator, the dispute will be submitted to binding arbitration. GIFTS If the parties dissolve their household, each party shall be entitled to keep any gifts given to them by the other. INDIVIDUAL INCOME, GIFTS, INHERITANCE The income of each person, as well as any accumulations of property from that income, belong solely to the person who earns the money. Should either party receive real or personal property by gift or inheritance, said property belongs solely to the person receiving the gift or inheritance and shall not be considered joint property unless transferred in writing. DIVISION OF PERSONAL PROPERTY If the parties dissolve their household, all jointly-owned personal property shall be divided equally between the parties based on net value. The jointly owned property shall be appraised. _________ and _________ agree to alternate the selection of items of said property until all items desired by either party have been distributed. The parties agree to flip a coin to determine who shall have the first selection. Any items of said property not selected by either party shall be sold and the proceeds divided equally between the parties so as to equalize the value received by each party. If the proceeds are insufficient to equalize the value received, the party receiving the greater value shall owe the other party one-half of the difference. Both parties agree that the division of said personal property shall be such that each party receives one-half (1/2) of the fair market value of all said assets minus the value of all liens, mortgages or other encumbrances which are outstanding thereon, the intent being to divide the jointly-owned assets equally unless otherwise agreed. The party receiving any asset subject to a lien, mortgage or encumbrance shall be solely responsible for its payment.

COUPLES COUNSELING Prior to the expiration of the three-month notice period, the parties will endeavor to sustain the household by mutually and in good faith pursuing couples’ counseling for a minimum of two 3

(2) months. The counselor must be acceptable to both parties. The cost of counseling shall be divided equally. SICKNESS OR DISABILITY OR UNEMPLOYMENT Each party agrees not to abandon the other in time of need, including sickness, disability, medical emergency or unintentional loss of employment. Each party shall endeavor to support the other emotionally and financially should the need arise for as long as the household is not dissolved, for a reasonable length of time. In the event of dissolution, it is expressly understood that neither party commits himself to providing financial support to the other and expressly waives any rights to “palimony” or other transfers of assets growing out of the nature of the relationship which may be implied or imposed by court order. POWER OF ATTORNEY Each party has named the other as his attorney in a Durable Power of Attorney and has designated the other as his Health Care Agent. In the event of notice of dissolution of said household, each party agrees to immediately return the originals and all copies of these Powers of Attorney to the other. In any event, the other party shall not exercise any powers under these documents unless otherwise authorized. DEBTS Unless otherwise stated herein, all debts incurred by the parties individually shall remain the responsibility of the party who incurred the debt for which he will be solely responsible. Neither party shall encumber the property of the other unless expressly agreed herein. HEIRS Both parties have executed wills naming the other as a beneficiary and personal representative of his estate. Upon the filing of a notice of dissolution, unless withdrawn, each party waives any rights they may have under each other’s will. © 2006 Lawrence S. Jacobs & Associates, P.C. All rights reserved. Used by permission.

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