More and more unmarried couples are living together. Statistics released at the start of the year show that there was a 29.7% rise in cohabiting couples in England and Wales between 2004 and 2014.
But what happens if these relationships break down?
THE 'COMMON LAW MARRIAGE' MYTH
Most cohabiting couples think they have the same rights as married couples when relationships break down, but they are wrong. Cohabiting couples have limited remedies compared to married couples.
Apart from provision for their children, they cannot claim for maintenance. Nor (unlike married couples) can they obtain financial orders against their partner’s assets even if they have been in a long relationship or if they have had children together.
IT MATTERS HOW YOU OWN A PROPERTY YOU LIVE IN TOGETHER
Unlike on a divorce (where the court has wide powers to make orders about the ownership of property), how a property is owned is really important for unmarried couples.
When two or more people own a property, they hold it on trust, and own it either as joint tenants or as tenants in common. As joint tenants, both parties own the whole of the property (the assumption is that it is held in equal shares). If the parties hold the property as tenants in common, they can own it in unequal shares. The parties should make a written agreement (a declaration of trust) as to the proportions on which they hold the interest. In the absence of an express agreement, the court may have to imply the proportions of their shares according to the circumstances. Factors will include advice or discussions entered into at the time of the transfer, the reasons for purchasing the house jointly, the purpose for which the house was required, the nature of the parties' relationship, how the purchase was financed both initially and subsequently, how the parties arranged their finances and discharged their outgoings and household expenses and whether there are any children involved. This can lead to lengthy litigation, as each case will turn on its own facts.
It is even harder for a cohabitant who is not a registered owner of the property to prove that he or she should have a share in the property when the relationship breaks down.
REFORM MIGHT BE ON THE WAY
Resolution's February 2015 Manifesto for Family Law (which Penningtons Manches supports) calls for the law to ’provide at least basic legal rights for couples who live together if they separate’.
A Bill, which would have addressed some of these issues, was being considered before the May election. If enacted, it would provide some powers for the court to make ‘financial settlement orders' for cohabiting couples in the event of separation. It remains to be seen if this government has the appetite for change.
As of today, cohabitants need to be alive to the fragile position in which they currently find themselves.
CONSIDER ENTERING INTO A 'COHABITATION CONTRACTS AGREEMENT'
To avoid lengthy and expensive disputes if a relationship breaks down, couples should consider entering into both a 'cohabitation agreement' and a declaration of trust in relation to any joint property.
THERE ARE ALTERNATIVES TO COURT
When a relationship breaks down, mediation or arbitration are alternatives that, in the right cases, can offer the advantages of reduced acrimony, costs and delay in resolving disputes.
For advice on any aspect of relationship breakdown or for further information about cohabitation agreements, contact a specialist family lawyer at Penningtons Manches.
This article has been co-written with Matilda Kay, a trainee solicitor in our family law team.