. . . being in a long-term, cohabiting relationship, gives you little or no entitlement, or protection in relation to your or your partner’s assets should that relationship falter. The concept of common law marriage is a myth.
Unmarried Couples – Make sure you are protected
There is a long list of reasons why unmarried couples, who cohabit, decide not to get married or enter into a civil partnership. However, the worst reason given is that they think they don’t need to because they have protection as a ‘common law’ married couple.
Where do we start?
If you only take one thing away from this blog, please take away this; unless you do something about it, being in a long-term, cohabiting relationship, gives you little or no entitlement, or protection in relation to your or your partner’s assets should that relationship falter. It is as simple as that. The concept of common law marriage is a myth.
What steps can be taken?
The two most important things you can do are to enter into a cohabitation agreement and/or enter into a declaration of trust. A cohabitation agreement is a type of contract which specifies who owns what, it can cover financial arrangements or other property such as cars and jewellery. It can also set out how you will both contribute to household outgoings.
A declaration of trust, traditionally known as a deed of trust, is most often made in relation to the family home. It is a really useful process whereby the couple can decide how the property can be shared. This is often a good idea where one person is moving into the home of another or where the purchase deposit was put up by one person solely or in unequal shares.
Although it is possible to do much of this work without a lawyer, these types of agreement can be complicated and there are some legal hurdles to jump over to make them legally binding so it is always a good idea to use a lawyer, even if it is just to put the finishing touches to the agreements.
What if we haven’t entered into an agreement?
Where an unmarried, cohabiting relationship breaks down and one party wants to secure an interest in the property, the only viable route (other than reaching an amicable agreement) is through a complicated piece of legislation called the Trusts of Land and Appointment of Trustees Act 1996 (ToLATa). Using this law it may possible for an unmarried partner to secure some level of ownership or ‘interest’ in a property. It is a complicated process and one you’ll definitely need the help of a lawyer with if you wish to pursue it.
Also, where there are children of the relationship an application can be made under the Children Act 1989 for a lump sum payment, regular payments or even a share of a property. However, like an application under ToLATa, it isn’t an easy process and it would be far better to have agreed such matters before the relationship breaks down.
Lawyers aren’t the most romantic of souls, but we do understand that when a relationship is going well, when a cohabiting couple have just moved in together or when they are expecting their first child, ideas of ‘formalising’ their financial affairs are often at the back of the mind.
All that being said, for the sake of peace of mind, for the sake of a stable financial future, a few hours spent with a lawyer, going through all of the bits and pieces allows the relationship to get off to a flying start, a flying start based on strong foundations.
Why wouldn’t you?