Cohabitation / Unmarried partners
It is a fact of modern life that many of us choose to live together with our partners, rather than getting married. If you are thinking about living with your partner, you should consider how your assets and any assets you may jointly acquire will be affected. It is a myth that the law recognises "common law" spouses, and protects their interests. There is no such thing as a common law wife or husband. The court will not take into account any circumstances of your relationship, the length of time that you have been together, contributions, income or assets acquired during the relationship, even caring for children or supporting your partner in his or her career or business.
It is therefore essential that you clarify at the outset of any cohabitation, how you will treat jointly acquired property, and what happens if the relationship does not work. We can assist with the drafting of cohabitation agreements and in particular trust deeds which are essential if you buy property together, and in the making of wills. We have specialists who deal with disputes over property ownership and give advice in relation to Court proceedings in particular under the Trust of Land and Appointments Act if necessary.
A cohabitation agreement is a contract entered into between two partners in a relationship. It records your intentions concerning any property, assets acquired and the day-to-day issues such as payment of bills. This agreement records your intentions before you cohabit or even can be entered into once cohabitation has started.
A Trust Deed is essential when you buy a property with an unmarried partner. There are common misunderstandings when you buy a property with someone else. It is very important that your contribution and interests are properly protected and your intentions as to your shares are clear. Very often, people buy property which they own as Joint Tenants thinking they will get their investment back. However following recent cases, in particular the case of Stack v Dowden and Kernott v Jones, the Court has said that it will look to the transfer documents signed at the point of purchase, and if as Joint Tenants, will presume you intended an equal share regardless of what you have invested in the property. Only in very rare circumstances will the Court adjust the shares to a 50/50 basis. In particular, if you are investing in a property in unequal shares, then there should be a Trust Deed setting out your intentions regarding what should happen in the future and what you will receive if that relationship ends.
WHEN ONE'S PARTNER DIES
It is also important for unmarried couples to consider what happens if one dies. Unless a will is made in favour of your partner, then should you die, your estate will pass to your immediate family under the intestacy rules rather than to your companion (except if they jointly own a property and hold the property as beneficial tenants in common). If you hold the property as beneficial Joint Tenants, your share would pass to your partner automatically by the principal of survivorship.
An unmarried partner of many years may not be entitled to administer the estate as they are not a relative or next of kin. Therefore it is essential that you provide a Will to provide for your loved ones.
In relation to death, if you fail to make provision for your partner, and you have cohabited and been dependant on each other, your unmarried partner may well have a claim under what is called Inheritance for Family and Dependants Act 1975, for the estate to make a provision for them, this can be a costly, time-consuming and distressing procedure. It is therefore crucial that you consider this aspect.
If during your cohabitation you go on to have a family and the relationship breaks down, the Court can make orders, under what is called Schedule 1 of the Children Act 1989, for financial provision to benefit children. This is over and above the provision that is under the Child Maintenance Enforcement Service to support the children which is payable by the non-resident parent. Under the Children Act, the Court can make orders for lump sums and even in relation to property. The Court can direct that a property is preserved to provide a home for the children until they reach 18 years of age or cease full-time education, therefore the non-resident owner cannot force realisation of their interests until that takes place. It is therefore vital that you take advice on these matters.
The court can also make orders if there are disputes over which parent they live with, seeing children, taking the children out of the country, education or a range of issues which affect families.
We have solicitors within the firm who are very experienced in dealing with all these matters and can advise you on the best course of action for you and your family. In view of the fact that there is so much misunderstanding, it is very important that you protect your interests.