Many couples live together without getting married or forming a civil partnership. While some people are clear on the implication of cohabitation, many do not realise that there is a lack of legal protection for them in the event one partner dies or the couple separate.
Cohabitants’ rights are more patchy and complex than many think and the law that applies in the event of a dispute can be uncertain and difficult to apply. JMW advises individuals from all types of modern family in a diverse range of situations.
Our clients seek advice on many aspects of family life, including:
- Making arrangements for children after separation
- Alternative families and fertility law
- Entering into prenuptial or pre-partnership agreements
- Cohabitation agreements and deeds of trust
- Shared home and other property disputes
- Financial provision for children under Schedule 1 of the Children Act 1989
Cohabitation and the Law
There is no such thing as a ‘common law spouse’. Even after living together for many years, cohabitants do not acquire any specific rights. However, due to a patchwork of legal provisions and official classifications as to what constitutes as a family unit, the misconception that common law marriage is a specific legal status persists.
Cohabitants can experience hardship if they separate or if one of them dies because they have no automatic right to inherit from each other.
Protecting Your Rights
Whether you are moving in with your partner or you are currently cohabiting, you should make sure your financial rights are protected, particularly if your property is owned rather than rented.
Consider what you would want to happen with the equity in your home and other significant assets if you did split up. If you plan to own a property jointly, the equity would be divided 50/50 in the vast majority of cases, unless the paperwork says otherwise.
If this is not what you want - maybe because you will be contributing different amounts towards the purchase price or mortgage instalments - you need to make this clear in the correct written format.
Provided matters are agreed, your respective shares in a property can be set before or during the period of ownership. We would always advise couples to consider the position before moving in together if at all possible.
How can a family law solicitor help with cohabitation?
Certain written documents can help to reduce some of the uncertainty that may arise in the event your relationship breaks down or one of you dies.
A cohabitation agreement is a legally binding contract entered into by two people who either are or are about to start living together, and sets out their financial obligations to one another. This can be as simple as setting out how the proceeds of sale of a property will be divided if the relationship ends, or as complicated as a lengthy document dealing with all elements of a couple’s financial life together. An agreement might:
- Deal with how much each partner will contribute towards household expenses
- Clarify the ownership of expensive items, such as cars or jewellery
- Set out how a shared property would be dealt with in the event of separation
The aim of a cohabitation agreement is to reduce the uncertainty that can exist when a couple sharing a home separately.
We regularly draft and advise on cohabitation agreements and can deliver a bespoke solution tailored to the specifics of your family situation.
Declaration of trust
A declaration of trust is a document dealing with the ownership of a specific property. It can be entered into before a property is acquired or afterwards, although the relative shares can only be changed by agreement. The declaration may be part of the transfer document signed when a property is purchased or part of a separate document, depending on the circumstances.
The declaration could say that person A is entitled to a given percentage of the net proceeds of sale and person B is entitled to the rest. Alternatively, it might say that one person is entitled to a set amount of equity with the balance divided into whatever shares you agree. There are many possibilities.
Everyone should have a will. Wills are particularly important for cohabiting families as the intestacy rules do not recognise the position of cohabitants or make provision for children dependent upon the deceased if they are not related biologically or by adoption.
If a person in a cohabiting relationship dies without a will, the surviving partner will not inherit their estate, apart from property owned as joint tenants and policies of which they are a named beneficiary.
The assets may go back to the deceased’s biological family whether or not this is what they wanted. A surviving cohabitant may have no right to any assets whatsoever or have to initiate expensive and lengthy court proceedings.
For more information on making a will, visit our Will Writing page.
For cohabiting couples, there is no equivalent to the comprehensive process for dividing assets on divorce in the event their relationship breaks down. Instead, each disputed asset is dealt with as a separate entity by applying the relevant law on trusts and property.
While the family dynamics may be very similar to those involved in a divorce or civil partnership dissolution case, the relevant law and procedures are not and call for a radically different approach, which has more in common with civil litigation than family law.
Cohabitation disputes can be legally straightforward, for example, if ownership documentation is clear as to how the equity in a property should be divided. However, they can also be extremely complex, particularly when there is a dispute as to what the parties intended and there is no express declaration of trust. Extensive evidence going back many years may need to be assembled and analysed.
The majority of disputes can be resolved by negotiation or through a non-court dispute resolution process. However, where the involvement of the court is needed, we stand ready to initiate or defend an application and ensure that your interests are protected.
As a full-service law firm, we can draw on the expertise of colleagues across a range of legal disciplines, including civil litigation and trusts and estate planning, in order to provide you with a first-rate service.
JMW has experience across a wide variety of disputes between cohabitants, including:
- Joint ownership cases where one party refuses to cooperate in a sale
- Disputes involving loans or gifts made by parents and other relatives
- Sole ownership disputes where one party argues for a financial interest in a property of which they are not the legal owner
- Issues arising between separating cohabitants who have been in business together
What is a cohabitation agreement?
A cohabitation agreement serves as a documented record of what you and your partner have agreed upon regarding the ownership and sharing of various aspects of your life. It establishes the conditions under which a cohabiting couple lives together and addresses the outcomes in case the relationship terminates. For instance, it can cover property interests and can record how any sale proceeds might be divided between a separating couple. It can also include financial support such as whether one party will pay maintenance to the other party following separation and for how long. A cohabitation agreement is designed to offer evidence of 'intention' and hopefully prevent future litigation.
A cohabitation agreement (sometimes referred to as a 'Living Together Agreement') has the following key objectives:
- It determines how the parties will cohabit on a daily basis, addressing issues like bill payments and home ownership.
- In the event the parties do not stay together, it aims to facilitate an amicable separation by outlining the responsibilities and entitlements of each individual.
- If relevant, it specifies the property owned separately by each party at the time the agreement is made.
- A cohabitation agreement encourages you to contemplate straightforward and equitable ways to organise your day-to-day finances, ensuring that if your relationship concludes, neither party suffers financial loss, unless previously agreed upon.
What is the main difference between cohabitation and marriage?
Cohabiting couples possess significantly fewer rights than married couples. The concept of 'common law marriage' does not exist. When a married couple divorces, there are legal provisions dictating how the court should handle their financial arrangements, such as property division and maintenance. Conversely, when a cohabiting couple parts ways, there are no legal provisions for maintenance or property redistribution.
When should a cohabitation agreement be made?
A cohabitation agreement is best established when you are preparing to move in together. However, from a legal standpoint, nothing prevents a couple from entering into an agreement at any point during their cohabitation. It is still a good idea even if you have been living together for 10 years.
What should be incorporated into a cohabitation agreement?
Financial matters are a crucial component of a cohabitation agreement. The agreement should outline each partner's rights concerning the property you reside in, the ownership of other assets, and the responsibility for any debts. The agreement commonly addresses the sharing of expenses while living together.
What should not be included in a cohabitation agreement?
It is generally unwise to incorporate behavioural rules in a cohabitation agreement. Attempting to legally bind someone to do household chores, or have responsibility for certain tasks such as maintenance and decorating, for example, would not be appropriate.
What steps can cohabitants take to protect their interests?
To protect their interests, cohabitants can take several steps:
- Draft a cohabitation agreement to outline the ownership and division of property, assets and responsibilities
- Create a declaration of trust to establish the proportions in which the property is owned and shared
- Make a will to ensure that their partner inherits as intended, since cohabiting partners do not automatically inherit under intestacy rules
What happens if a cohabiting couple separates?
If a cohabiting couple separates, there is no legal provision for maintenance or property redistribution, unlike in a divorce. The couple may need to rely on their cohabitation agreement or seek legal advice to resolve disputes over property, assets, and child arrangements.
Can cohabitants make financial claims against each other after separation?
Cohabitants can make financial claims against each other after separation in certain circumstances, such as through claims under the TOLATA to establish property shares, or Schedule 1 Applications for financial provision for children. However, claims are usually more limited than those available to married couples.
What are the cohabiting couples separation rights?
Cohabiting couples' separation rights are not as extensive as those of married couples. They can make claims through TOLATA for property shares and Schedule 1 Applications for children's financial provision. It is essential for cohabiting couples to seek legal advice to understand their rights and protect their interests in case of separation.
My partner and I are splitting up. They don't want to sell our house and refuse to discuss buying me out. Can you help me?
The majority of disputes of this nature can be dealt with by negotiation, without the need for court proceedings. However, in a small minority of cases, the only way to break the deadlock is to make an application to the court to order the sale of a disputed property and make a ruling as to how the proceeds are to be divided. This is very much a last resort but the option is there to make sure this type of situation does not continue indefinitely.
Do I have any rights if I live in my partner's home and it is in their name only?
This is potentially a very complicated situation. It is possible for a person who is not the legal owner of a property but has nevertheless made certain types of contribution towards it to acquire a financial interest in it.
If a cohabiting relationship breaks down, and the parties’ respective rights and interests have not been made clear in advance, there can be a high level of uncertainty and, in some cases, expensive litigation can follow. You can reduce this uncertainty by signing up to a cohabitation agreement.
However, if you find yourself in dispute with your former partner, it is important to take early legal advice. Seemingly small actions can assume great significance in disputes over the equity in a home, so it is crucial to establish a clear strategy and avoid pitfalls right from the start.