The Government has this week confirmed it plans to launch a consultation on cohabitation, with the overriding concern being the legal rights and protections for women in cohabiting relationships.
Lord Ponsonby of Shulbrede, the minister overseeing family justice, marriage and divorce, told a House of Commons justice select committee that a formal consultation will be issued this year to “build public consensus on what cohabitation reform should look like”.
David Anstee, managing partner and family law specialist at KWW Solicitors in East Molesey, welcomed the news. He said cohabiting couples were the fastest growing type of family and they were being ignored by the law as it stands.
“There is very little protection available if a relationship breaks down, and the financially weaker individual will lose out significantly,” said David.
The number of cohabiting couples in the UK has risen from roughly 1.5 million in 1996 to more than 3.6 million today.
More couples are choosing to live together without the formalities of marriage or civil partnership. While this lifestyle choice might seem modern and convenient, it can leave individuals vulnerable when it comes to financial protection.
Unlike married couples or civil partners, cohabiting couples lack a legal framework that automatically safeguards their financial interests.
The Myth of the ‘Common Law Marriage’
One of the most pervasive misconceptions is the belief in a ‘common law marriage’. In England and Wales, no such legal concept exists. Simply living together, regardless of the duration, does not grant you the same rights as a married couple or civil partners. This misunderstanding can lead to significant financial hardship, especially upon separation or the death of a partner.
Key Financial Risks for Cohabiting Couples
- Property Ownership
- If a property is solely in one partner’s name, the other partner has limited rights, even if they contributed financially to the mortgage or renovations.
- Joint ownership can also be problematic if there’s no clear agreement on how the property should be divided upon separation.
- Financial Contributions
- If one partner has made significant financial contributions to the household, such as paying bills or for improvements, they may struggle to recover these contributions upon separation.
- There is no automatic right to a share of assets acquired during the relationship
- Inheritance
- Without a valid will, the surviving partner may receive nothing from their deceased partner’s estate. This can be particularly devastating if the deceased partner was the main breadwinner.
- Financial Support
- Unlike married couples, there is no automatic right to spousal maintenance or financial support after separation. This can leave one partner, particularly those who have given up their career to care for children, in a precarious financial position.
- Pensions
- Cohabiting partners are not automatically entitled to their partner’s pension benefits. This can create a large financial gap if one partner dies.
To mitigate these risks, cohabiting couples should consider the following:
- Cohabitation Agreement
- A cohabitation agreement is a legally binding document that outlines the financial arrangements between partners, including property ownership, financial contributions, and how assets will be divided upon separation. It reduces the potential for disputes.
- Declaration of Trust
- If you are jointly purchasing a property, a declaration of trust can specify the percentage of ownership for each partner, reflecting their financial contributions.
- Wills
- Both partners should have a valid will that clearly states their wishes regarding their assets. This ensures their partner and any children are adequately provided for.
- Life Insurance
- Taking out life insurance can provide financial security for the surviving partner in the event of death.
- Joint Accounts and Records
- Keep accurate records of financial contributions and ensure joint bank accounts are well documented.
Seeking Legal Advice
It is crucial to seek legal advice from a qualified solicitor specialising in family law. At KWW Solicitors, we can help you understand your legal rights and obligations, draft a comprehensive cohabitation agreement, create a valid will and resolve financial disputes.
Important: This article provides general information and does not constitute legal advice. You should seek professional legal advice tailored to your specific circumstances.