Legal gap between married and cohabiting couples
Family lawyers have long called for legislation to plug the gap in the law between married and cohabiting couples, but they and cohabitees alike will be bitterly disappointed this week as the Government has rejected the opportunity to give cohabiting couples the legal protection they need.
Cohabiting couples or couples living together are now the fastest growing type of family with over 3.6 million couples cohabiting in England and Wales. This is up from 1.5 million couples in 1996.
Families classed as “cohabiting couples”, however, have far less legal protection than those who are married or in a civil partnership, either on separation or death. Often referred to as ‘common law spouses’, there is a widespread myth that cohabiting couples have similar rights to married people after a certain amount of time living together. This is not the case and unfortunately, unlike married couples, cohabitees must rely on a hotchpotch of legislation covering contract, property, and trust law to achieve a resolution.
The Women and Equalities Select Committee published a report in August of this year within which they too called for reform to better protect cohabiting couples and their children in the event of a separation or death.
Updated guidance for those in an unmarried relationship
The Government responded to that report on 1st November 2022 and, unfortunately, declined to make any legislative changes at this time stating a wish to focus on marriage and divorce law first. The Government also stated it had no intention to extend the inheritance tax provisions but would keep this under review.
As such, it seems any potential for change has been kicked into the long grass whilst cohabitees are left in the same unsatisfactory legal position.
How our solicitors can help with legal rights when cohabiting
We see many couples who are concerned about a home they have bought together or in which they have lived as a family. The most widely used piece of legislation in these circumstances is the Trusts of Land and Appointment of Trustees Act (TOLATA) 1996 with cases falling under the jurisdiction of the civil rather than family courts. Pursuing an application under this law, however, can be complex, time consuming and certainly very costly. Such litigation is also highly case specific.
Where possible, we recommend trying to head off any potential costly and protracted litigation in the event of a separation by entering into a cohabitation agreement. A cohabitation agreement – sometimes known as a ‘living together agreement’– is a legal agreement setting out how assets are owned and distributed between partners, and what happens upon separation or death. There is no set time when a couple must enter into an agreement. Some like to have this prepared when they first move in together; others may have been living together for a few years but some life event has perhaps prompted the decision, the birth of a child for example.
A cohabitation agreement
A cohabitation agreement will likely be upheld by a court if both partners have sought independent legal advice about whether the agreement is fair and safeguards their interests.
The initial conversation with the other party can, of course, be a tricky one, particularly at a time when the relationship is in good form.
A cohabitation agreement is, nevertheless, a sensible document for many couples to have making provision for the future, allowing both partners to understand their rights and what the financial landscape would be upon separation.
Unless stated to the contrary, a cohabitation agreement will also technically continue to be in effect during and after marriage.
That being said, a cohabitation agreement can’t displace other legal rights meaning, for example, any rights acquired on marriage won’t necessarily be undermined by such a document.
Some couples may therefore decide that the agreement will terminate on any marriage and revisit their finances afresh at that stage and potentially replace it with a prenuptial agreement instead.
Is a cohabitation agreement worth the cost?
By drawing up a cohabitation agreement, in the first instance however, both parties to a relationship can provide themselves with many of the same legal rights as those enjoyed by married couples or those in civil partnerships by agreement thus ensuring financial stability in the future.
For further details please contact Helen Davies on 01244 354800 or email Helen.davies@dtmlegal.com. Visit our Cohabitation page for more information on DTM Legal and our Cohabitation services.
