Are you a “common law” husband or wife? If you are, you might be thinking that because you have been living together for a couple of years that you have protected yourself legally and financially. You might think that all is well, that you have acquired some legal rights because of the length of your relationship.
A recent survey has suggested that almost half of UK citizens aged between 18 and 34 believe that cohabiting couples have the same legal rights as married couples.
Whilst many of us use and hear the term “common law” as reference to the fact that we may not be married but are living with our partners, this does not give us the rights or obligations enjoyed legally by married couples or civil partners. ‘Common law marriages’ mean nothing, legally, no matter how long you may have been living together.
The Office of National Statistics confirms that just under 3.2 million of us were living together in the UK in 2015. More and more of us are choosing to do this rather than have a legally recognised relationship. But despite the increasing numbers there is a lack of legal protection on separation and on death.
When married couples separate the law gives a wide ranging discretion to look at a financial settlement. Lots of things are taken into account when dividing assets in order to achieve a fair and reasonable outcome for both parties. When a cohabiting couple separate, their own needs are not considered and non-financial contributions such as looking after a home or raising a family are not given any weight against the financial contributions they may have made. This can mean an unfair outcome.
Equally, there is no protection if one of you dies. The survivor will not automatically have a right to their partner’s estate under the intestacy rules. As such, it is hugely important that you both make a will and ensure that your partner benefits from your assets. This will go some way to avoid a mess for them when you are gone. Even so, there is no inheritance tax exemption as there is for spouses.
So what can cohabiting couples do to try and get some protection on separation?
Most are unaware that they are able to have a Cohabitation Agreement. A properly drawn agreement can set out the ownership of assets, dealing with financial arrangements whilst they live together and stating clearly how their assets should be divided should they separate. Couples who own property together are advised to enter into a declaration of trust which sets out the specific shares they are to have in a property.
But what if a separation becomes acrimonious and there is a disagreement about your home? Cohabitees can look to the Trust of Land and Appointment of Trustees Act 1996 which enables a court to decide whether there is an interest in a property, the extent of that and give an order dealing with how best to resolve the issue. Regardless, where homes are not be in joint names it can be very difficult for the non-owner to prove that they should have an interest, even if they have been living in it for some time.
If there are children involved, financial settlements can be applied for under the Children Act 1989 for maintenance, sums of money, or a property transfer for the children’s benefit. These agreements are rare and focus entirely on the child’s needs and not the parent. There is no maintenance claim for you personally as there is for a partner who has married or in a civil partnership.
Because of these vulnerabilities there has been a campaign for the law to catch up with our modern family structures. This has seen the introduction of the Cohabitation Rights Bill which would give more legal protection to you. The Bill is currently waiting its second reading.
If passed it would parties to look for a financial settlement – like married couples can. But the parties must have lived together for a continuous period of at least three years in order to be eligible for that legal protection. The bill also provides an insurable interest in each other’s lives and would enable on party to make claims on the death of the other.
There is, however, an anomaly.
Same sex couples have a choice of whether to marry or enter into a civil partnership if they want legality. Civil partnership offers same sex couples an alternative to marriage with almost identical legal rights. But this choice isn’t available to opposite sex couples who have the more limited choice of either living together or getting married.
An opposite sex couple recently took legal action and challenged the law because they wanted a right to have a civil partnership rather than a marriage. They tried to register their intention to enter into a civil partnership and were turned away because they weren’t a same sex couple. They fought the law to allow them to have a civil partnership but although unsuccessful, highlighted the issue.
In October 2015 a bill was presented to the House of Commons in support of opposite sex civil partnerships. If successful, I would consider it a positive step. In any eventuality, as the ways in which we choose to spend our lives together becomes more and more diverse, changes are needed to reflect our modern relationships to create a more balanced situation for all couples wanting legal protection.
By family and divorce solicitor, Mandy Rimmer