Cohabitation and Common Law Marriage
The number of married couple families decreased by 457,000 between 1996 and 2012, to 12.2 million in 2012. This reduction is statistically significant. It is also consistent with both the decrease in the number of marriages since the early 1970s, and the statistically significant increase in opposite sex cohabiting couple families between 1996 and 2012, from 1.5 million to 2.9 million. * So what is the impact of cohabiting compared to marriage?
The term Common Law Marriage is a misconception; it has no legal standing. This does not however mean that couples that live together do not gain rights over the others property. As a result of a marriage both parties’ assets are general grouped together and known as a “matrimonial pot.” Upon separation matrimonial law will dictate how the assets are divided. However, when people simply live together claims against the partner’s property are limited only to the house you have lived in together. The division of assets here relates to Land Law.
Beneficial Interest in Partners House
It is possible for a non-owner partner to claim a beneficial interest in a house which they have shared with a partner. To do so they must claim that there was a common intention that the house would be your home together. This can be evidenced either by a written agreement or by showing from your actions that this was the intention. It is the latter which often proves more problematic and there is a great deal of case law which applies to the complex area. Common examples of people successfully providing this include making contributions towards the purchase price, making substantial renovations or simply a promise/discussion between the parties which led to the non-owner acting to their detriment in investing time, effort or money into the house.
If a person claims a beneficial interest in a property this means that they have a right to live there, can prevent or delay a sale, force a sale and eventually take a share of the proceeds from the sale of the property.
Before you move in together — Cohabitation Contract
We would advise that anybody considering moving together into a house that one person owns to enter into a Cohabitation Contract. This contract will set out exactly what your intentions are; whether the non-owner will establish an interest in the property or not and what will happen in the event that things take a turn for the worse.
We can provide a fixed fee cohabitation agreement which gives you both piece of mind now as to what may happen in the future.
On separation — Separation Deed
If you are considering going your separate ways a Separation Deed will ensure that things are tied up properly. The Separation Deed will set out exactly what you have agreed which will prevent the non-owner coming back in the future to reclaim their beneficial interest in the house.
As with Cohabitation Contract, we can provide a Separation Deed for a one off fixed fee which gives you both piece of mind now as to what may happen in the future.
When things cannot be agreed
If an agreement cannot be reached as to what interest the non-owning spouse has it is possible for them to issue an application to the court to make a claim. These proceedings can prove costly however due to the complexity of this area of law. It is for this reason that the above options should be given a consideration. A one off payment now may save much higher legal fees in the future!
If you are unfortunately at the stage where court proceedings are your only option, please contact one of our Family Team who will discuss with you the most cost effective way of finalising matters for you.