There is a common misconception that unmarried couples obtain certain rights and privileges when they become a “common law wife or husband”. The truth is that this term “common law” means absolutely nothing in today’s world. As the law stands no matter how long you have been together, you will not have the same rights as a married couple. An unmarried partner will have no right to maintenance or their partner’s pension. Furthermore there is no automatic inheritance should your partner pass away before you, unless they have made a will.
More and more people are choosing not to marry, but make a commitment to live together and buy a property. A Cohabitation Agreement is designed to make parties think about their financial positions and their wishes before any dispute arises.
The agreement is a written document that sets out the parties’ intentions and states that they wish to be bound by its terms. These types of agreements are useful for any couple who do not intend to get married or enter into a civil partnership. The document should detail who owns what and what would happen if the relationship ends. The couple should try and be as specific as possible as to what their intentions are. The document should answer questions like “what if one party puts in more money than the other?” If the couple separates should the property be sold or can one party buy the other out? Couples should also give consideration to maintenance and improvements to the property and whether this should impact on their respective shares in the future.
Other issues to be considered include joint debts, personal possessions, cars and even arrangements about children. This is not an exhaustive list and each couple’s personal set of circumstances should be discussed with their legal adviser.
We appreciate that if you wish to consider entering into such an agreement it could prove difficult to have that conversation with your partner. However unromantic the conversation is, we would say that it is necessary.
Cohabitation agreements are particularly useful for someone who already owns their own property or who is about to buy a property in their sole name and then have their partner move in. The owning partner needs to consider his or her position very carefully. We often find that following the breakup of the relationship, the nonowner partner tries to argue that he or she should have a share in the property. This is obviously very distressing and difficult for the partner who owns the house. Often the non-owning partner will argue that they have acquired this interest because they have made substantial financial contributions towards to the house. The courts often have to look at the intentions of the parties. Did they consider it “their house”. A Cohabitation agreement clearly sets out the parties’ position often stating different shares in the property and how contributions should be treated.
If the agreement is drawn up correctly then it is a contract between the couple. The agreement should state that both parties intend to be bound by its terms. Ideally both parties should have obtained legal advice and the document itself be signed and witnessed as a Deed.
The short answer to this is no. It is advisable to review the cohabitation agreement approximately every five years or upon a change of circumstance for example the birth of a child. Furthermore if the parties marry, we would advise the parties to consider entering into a pre-nuptial agreement.
This is a question which legal professions have asked for many years. We can only work with the law that we have. Parliament are currently considering the Cohabitation Bill. The Bill seeks to give cohabitants some of the same rights as married couples. We are still unsure whether this will take effect. This uncertainty can be unsettling, especially if you have entered into or are considering entering into a cohabitation agreement. We are now able to “opt out” of this bill in anticipation of it being passed as law. This would mean that your agreement would stand regardless of what Parliament do in the future.
We have to be realistic and recognise that relationships do end. Despite best intentions relations can become fraught and parties sometimes cannot communicate and settle their own problems.
Co-habitation agreements are still fairly new and therefore many couples may not have made any written agreements when they decide to live together. Property disputes between unmarried couples can be long and very complex depending on the ownership of the property. At Wards Solicitors we deal with all types of property disputes between unmarried couples.
We make every effort to try and resolve the situation through negotiation and mediation however if the matter does result in court proceedings, it can be a lengthy and costly affair. It is for this reason that we are suggesting to couples to consider these issues at the outset so as to avoid the potential dispute a few years down the line.