Cohabitation and the law – Part 1
Recent statistics have revealed that the popularity of couples living together outside marriage continues. What has not changed much, however, is the legal position of each of the parties during the relationship or if it breaks down.
Although the Law Commission has recommended to Parliament that there should be legislation to give more in the way of protection to separating couples who were not married, there appears to be no appetite to grasp this issue. Perhaps Members of Parliament have other things on their minds at the moment!
Common law marriage not recognised by the law
We are regularly consulted by one of the parties to relationships which have broken down, who tell us that she/he has been 'in a common law marriage for x years'. That party then often says that she/he is looking for a share of everything that is owned by each of them. It is then that we have to advise that the legal status of parties who live together outside marriage is very different to those who are.
The concept of common law marriage has no legal validity in England and Wales (though cohabiting couples in Scotland do have some basic rights if their partnership ends).
In reality, moving in together does not give automatic rights to a share of all property, no matter how long the parties live together. For example, if one of the partners dies, the fact that the couple have cohabited does not entitle the survivor to inherit property automatically (see below). The only solace is that if a cohabiting couple who have children separate, both cohabiting partners will in most cases have rights and responsibilities – even if only one of them is the biological parent.
Cohabitation and the family home
If the family home of parties who lived together was owned only in the name of one party, then on the ending of the relationship or even the death of the owning partner, the other partner has no automatic right to stay in it or even to a share of the property. Obviously this can have very serious consequences for the surviving partner, the 'common law spouse', who had thought that she would be protected.
There are two situations which most frequently occur in relation to the family home. These are:
1. A home which is owned
When the home is owned just in the name of one of the parties, whether or not, on separation, the other party has the right to share in part of the value of the property, depends upon what can sometimes be very complicated rules. The non-owning partner may be entitled to share of the property if:
- the legal owning party has agreed in writing that the non-owner is entitled to a share of the home
- the non-owner contributes financially (eg paying part of the mortgage) to the property on the understanding that this entitles him or her to a share
- the non-owner has acted to their own detriment (eg giving up a job) on the understanding that this entitles him or her to a share
- a partner with children applies to the court for the right to continue living there to ensure the children's welfare
Owning a property in joint names can help to protect the rights of both cohabiting partners, but there are potential pitfalls. For example:
- A party who leaves cannot force the remaining partner to sell the home unless there is an agreement or a court order
- even if one of the owning parties contributed most of the costs of buying the home, that person would normally only be entitled to a half share unless the parties have agreed otherwise
- if one of the owning partners leaves the home, the remaining party is likely to be liable for the full amount of any mortgage payments and not be able to claim against the other party
2. A home which is rented
Where the parties live(d) in rented property, only the tenant(s) named on the rental agreement generally has the legal right to live there – and that person has responsibility for paying the rent. The other party who is not a legally named tenant:
- will technically almost certainly need the landlord's consent to move in
- can be asked to move out at any time (after giving reasonable notice)
- has no right to stay if the named tenant decides to leave (though the landlord might agree to change the name of the tenant on the agreement)
Whatever your circumstances, a written cohabitation agreement detailing what contributions each party will make and the share of the home to which each is entitled, minimises the risk of future disputes.
Money and other possessions
When a separation occurs between a couple who is not married, there is no legal duty on one of the parties to support the other, even when the other has no income. Different considerations apply, however, in connection with the financial support of any children.
Similarly, the separated parties do not automatically share ownership of possessions, savings, investments, businesses, property, land etc.
The fact that parties begin to live together does not affect the legal ownership of an asset acquired before or even after the cohabitation starts. The effect is that:
- if one party makes a gift to the other (even of something expensive like a piece of jewellery or a car), that item belongs legally to the person who received the gift and cannot be reclaimed by the party who gave the present if the relationship breaks down
- an item owned by one party before cohabitation continues to be owned by that party
- if one party acquires a possession or money (e.g. an inheritance) or creates savings, that party continues to own it even on separation
- if the parties acquire an asset, or make savings, by making joint contributions together (e.g by each contributing towards the price or agreeing that the item will be owned in defined proportions), the shares in which the asset or savings are owned depends on the contributions made by each of them, unless different shares of ownership were agreed
In the above situations, a written cohabitation agreement can help avoid disputes: for example, by setting out how much you each contribute to a joint account and how ownership of any items bought using the money will be shared.
If you have any debts in joint names (eg credit cards), you are normally each liable for the debt. If your partner fails to pay, you can be pursued for the full amount. You may also both be liable for household bills.
Tax and benefits
Parties who cohabit continue to be assessed for tax in the same way as any other individuals.
If either or both of the parties wishes to claim benefits of any sort, entitlement will be assessed taking into account the household income and assets.
The second part in this series will provide further detail regarding children of a cohabiting couple and cohabitation agreements.