"Living Together - What to consider and where you stand."
In England and Wales, when married couples divorce they both have a legal right to support and their fair share of the marital assets. The court will take into account various circumstances and the history of the relationship to enable a fair division. As a Cohabiting couple there are no such rights, regardless of the length of the relationship or whether there are children.
It is a common misconception that as a cohabitee you become a “Common-Law Spouse” after a period of time. In reality there is no such thing. You cannot gain rights in respect of your partner's property simply by living in their house for a number of years.
Overall there is very little protection for Cohabitees and the weaker party, who is often the main carer of the children, can find themselves facing real difficulties in the event of a relationship breakdown. It is possible to make certain financial applications on behalf of a child but doing this will mean a court application with it's associated costs.
Often the only legal recourse is an application under Land Law, for an Order for Sale of the family home, which can be complex and take many months to conclude.
Here is an example of a common situation:
A woman moves into her partner's property (which remains in his sole name) they subsequently have 2 children. After 15 years the relationship breaks down. The woman has no right to remain at the property nor any claim on it, even if she contributed towards the mortgage, unless the ex-partner agrees to her having a share.
Furthermore, she does not have a claim for maintenance for herself regardless of whether her partner has supported her during the relationship. When she leaves the property if the children go with her, she will be entitled to claim child maintenance which is a separate issue.
She could consider applying to remain in the property for the benefit of the children under the Children Act 1989 Schedule 1 whilst they are under the age of 18 years.
She could apply to court and attempt to demonstrate that she has acquired a share of the property by way of trust, but the law is sketchy often leaving the courts to flit between legislation related to property and trusts which is technically complex and could therefore cost an enormous amount of money to fight it out in court.
Often the party leaving the house is unable to afford to take the matter to court, which will mean they can't do anything to address the situation.
The position is of course different if you have your home registered in joint names.
There are 2 ways to hold a property in the UK, which is not often explained at the time of purchase. You can hold as Joint Tenants which is the most common way and in the event of one of you dying the survivor automatically receives the whole property. The other way is Tenants in Common which will be in equal shares unless specified in writing. In the event of death, the deceased's share then passes in accordance with their Will or the intestacy rules if there is no Will.
Where the property is owned jointly English law will automatically divide it 50:50 – even if one partner contributed more to it's purchase. The only way to change this is to alter those shares at the land registry usually at the time of purchase or by a written legal agreement saying in what proportions it is owned.
At present there are no plans for legal reform on the horizon to address issues that arise out of cohabitation and therefore the best way forward is to make a clear concise written arrangements of your own. Currently if you want the full protection of the law it would appear that the best thing to do is considering marrying or draw up a Cohabitation Agreement, which is a bespoke agreement to suit your exact living arrangements and future intentions, otherwise known as a “Living Together” agreement.
What is a cohabitation agreement?
It's a contract that sets out who owns what, in what proportions and lets you set out exactly how you will split your property, its contents, personal belongings, savings and other assets should the relationship break down.
The agreement can also provide for what happens to your bank accounts, debts, and joint purchases. You can also include financial provision for any children that there may be.
The agreement can also set out how you and your partner will run the household finances, such as how much each contributes towards rent or mortgage and bills.
Another consideration maybe provision of life insurance.
A practical agreement can save a lot of heartache as well as money in the future. An agreement about how you are going to live together can be created sensibly at the beginning of your relationship fairly and in the absence of the emotions that arise in the event of a breakdown.
How do I get a cohabitation agreement?
Ideally before coming in to see us, you should have agreed a list of who owns what, how your things are to be divided in the event of a split and what you want from your agreement. We can help you think about these things if you are having difficulty.
The agreement is basically a set of financial rules by which you will run your relationship and be bound by if the relationship breaks down. You will both need independent legal advice, so one party would be our client and the other would need their own solicitor.
One solicitor then prepares the agreement and the other advises the other party about the legal implications of the agreement and makes sure it reflects what you both intended and have agreed. Once everyone is happy, we can then proceed to signing the agreement and having it witnessed.
Is it a legally enforceable agreement?
The Answer is yes, if it is prepared properly and both sides have received legal advice. By having independent legal advice, it adds to the enforceability of the agreement as no one can then say that they didn't understand what they were signing or that they are pressured into signing it. We always add a schedule to our agreements to be completed by each solicitor who has advised, to demonstrate this fact.
If faced with a properly drawn up cohabitation agreement the court will look to abide by it and enforce it appropriately. We do find however that after having a properly prepared and thought through document that these agreements are rarely challenged in the circumstances of a relationship breakdown. Couples tend to abide by the agreements they have entered into voluntarily and with a great deal of thought.
How much will it cost?
The amount of time required to prepare an agreement depends upon how complicated you want the agreement to be or the amount of assets involved. Our fees start from £750.00 + VAT for a simple agreement. This includes drafting the agreement, dealing with the solicitor on the other side, making any subsequent amendments up to the final signing of the agreement. You should also budget another £500 or so for the second partner to pay their own solicitor for independent advice on the agreement, as discussed earlier.
Whilst you may not want the cost of a cohabitation agreement in addition to the costs of moving in together, it is nothing compared with what it could cost to sort things out in court, if you go through a breakup without an agreement.
Can I use an agreement from the internet?
We would advise against downloading ready- made cohabitation agreement templates from the internet because to stand any chance of being upheld by the courts, you must have both taken independent legal advice and the agreement must have been drawn up properly without errors.
How else can we protect one another?
Make a Will.
If you die without a Will your belongings will get divided in accordance with the laws of intestacy and our current law does not acknowledge cohabitees. So, if you want to make sure your partner is protected make a Will setting out what you would like to happen, for example that they are allowed to remain living in your property. If you are not married or in a civil partnership, a Will is the only way to make sure your partner will inherit if you die.
Written by Joanne Bennett
