Common law marriage is a myth in England and Wales. As a result of this common misconception, cohabitees can find themselves in financial difficulty if their relationship breaks down. Couples who live together are not able to make the same financial claims as those who marry or have a civil partnership.
The Cohabitation Rights Bill is designed to provide certainty for cohabitees, on separation and death, by allowing them to make financial claims like those which can be made by married couples and civil partners. However, this proposed reform is currently low on the political agenda.
Unless cohabitees have a child and the ability to make claims for the benefit of that child (see Financial Provision for Children), their financial claims are limited to property and determined by reference to property and trust laws.
Financial disputes between cohabiting couples are usually determined by reference to the Trusts of Land and Appointment of Trustees Act 1996 (often referred to as TLATA or TOLATA proceedings).
It is generally the case that cohabitees have no interest in a property held in the sole name of the other, and have an equal beneficial interest in a property held in joint names, unless there is express agreement or evidence of a common intention between them for the beneficial interest to be held otherwise.
If there is a dispute about ownership of a property, the burden of proof is on the party who seeks to show that the beneficial interest differs from the legal interest in the property. For example, where one party claims to have a beneficial interest in a property which is held legally in the sole name of the other by virtue of a financial contribution to the property.
All unmarried couples who plan to purchase a property and live together should seek advice from a specialist family lawyer, whether the property is to be acquired by them jointly, in equal or unequal shares, or by only one party, with or without a contribution by the other, to ensure that they are appropriately and adequately protected if the relationship breaks down, or their partner dies.
Parties who live together, as a couple or otherwise, can record in a cohabitation agreement (otherwise known as a living together agreement) their rights and responsibilities in relation to the property, as well as other financial arrangements between them, during their cohabitation and if they decide that they no longer wish to live together.
A cohabitation agreement can also be used to record ownership of personal property, such as cars and household contents, which may be used by both parties when they live together but are to be retained by the legal owner if their relationship comes to an end.
A well-drafted cohabitation agreement can avoid disputes and the potential for lengthy and expensive litigation at the end of a cohabiting relationship.
Unmarried parties who intend to purchase a property together or to contribute financially to a property held in the sole name of the other should seek advice from family and property lawyers about holding the property as joint tenants, as tenants in common in equal or unequal shares, or as a sole owner for their sole or joint benefit. If parties agree to hold the property other than as joint tenants, they should also execute a declaration of trust or legal charge to record their respective interests in the property.
The law relating to cohabitation, property ownership and the sale or transfer of a jointly occupied property is complex, so parties should seek legal advice before moving in together.
Our expert family team is regularly instructed to advise cohabiting clients on the funding and acquisition of properties, to draft or review cohabitation agreements, and to advise on their legal rights and obligations for themselves and the benefit of any children of the relationship if their relationship breaks down.
We also work with Sheridans’ property lawyers, who deal with property sales, purchases and mortgages, declarations of trust and legal charges, to provide a comprehensive legal service for cohabitees.
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