A bill to improve the legal rights of cohabitants was given a second reading in the House of Lords last month, putting forward a number of proposals that would help to provide better financial outcomes for separating unmarried couples.
Under current UK family law, cohabiting couples are not protected by the same legal rights as married couples or those in civil partnerships. If they decide to split up and there is no cohabitation agreement in place, individuals have no right to assets or property unless they are held in joint names. This means that if one party has sacrificed a career to raise children, or their home is rented or mortgaged in their partner’s name only, they are not eligible to a fair division of assets upon separation.
There are 6.6 million cohabiting couples in the UK – the fastest-growing family form – and a quarter of children are growing up in cohabiting households. Around 40% of all cohabiting couples have children together, and the bill’s proposals highlight the need for better legal protections for these families in the event of separation.
Lord Marks of Henley-on-Thames, who put forward the Cohabitation Rights Bill in March, said that the proposed changes aim to “address economic unfairness at the end of a relationship that has enriched one party and impoverished the other in a way that demands redress.”
“The reality is that, in the absence of cohabitation agreements, cohabiting couples have virtually no legal protection. Rights to property are difficult and expensive to establish. They depend on outdated and unwieldy trusts law. A claimant has to show a joint intention that property should be jointly owned, and it remains extremely difficult to predict or ascertain what courts will decide the parties’ shares should be, even where joint ownership is established.
“Child support protects the parents of minor children, where the arrangements work, and provides some financial support. However, when the children are older that stops, and the caring parent might be left unsupported, often having given up a career to look after the children. [I]f a woman gives up a career to live with a man and look after their children, or even just his children, and contributes to his business, even spending her savings to do so, there is no relief. If one partner in a couple works hard in the business of the other and suffers financially as a result, and then they break up, there is no relief. If one partner helps to build up the assets or the property of the other and cannot establish an intention that it should be jointly owned, or cannot afford to try, there is no relief.
“The present law is a charter for partners in cohabiting couples, whether inadvertently or deliberately, to take financial advantage of their relationship and to walk away when it ends, leaving the other party disadvantaged and without redress. Then again, if one partner dies without a will, the other will inherit nothing as of right from the estate, not even the home they lived in together.”
If the proposed changes to cohabitant rights were enacted, the courts would be able to assess and adjust the financial impact of relationship breakdown on cohabiting couples in a way that is more similar to the process of divorcing couples. Living arrangements, children’s well-being, and contributions to the household would be taken into account to ensure that assets are divided more fairly and provision is given to potentially vulnerable individuals.
According to the British Social Attitudes Survey, 46% of people in England and Wales believed in the myth of ‘common law marriage’ – in which cohabiting couples benefit from similar legal protections as married couples and couples in civil partnerships. However, this is simply not true, and unless an unmarried couple have an up to date will and a cohabitation agreement that clearly sets out their intentions for the division and inheritance of assets, they could find themselves in a dire financial situation in the future, with no legal recourse to claim relief. Lord Marks commented that this ‘level of ignorance is truly alarming’ and stressed the need for increased awareness of the lack of rights for cohabiting couples.
It’s vital that cohabiting couples know their legal rights and have an agreement in place to help them manage their finances in the event of separation. For more advice and information on cohabitation agreements, wills for cohabitants, or what to do if you are thinking of splitting up, get in touch with our family law team. We offer a free 45-minute consultation for family issues, and our down-to-earth solicitors are here to take the weight off your shoulders. Email firstname.lastname@example.org or call 01628 634667 to book your appointment.