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The Changing Face of Family Law
Cohabitants and the law
At Leathes Prior, we have lost count of the number of occasions on which clients have said that their partner is their common law wife or husband. Some people say common law marriage comes into being after two years cohabitation. Others say six months. All of them are wrong. There is no such thing as a common law wife or husband. Common law marriage was abolished in 1753.
It doesn’t matter how long you live together. If you don’t get married, then under the law as it presently stands you don’t get the same rights and responsibilities as married couples or those in civil partnerships. Instead, upon separation or the death of one party, the remedies available are what has been described by the Law Commission as “a patchwork of legal rules” which are often not specifically designed for cohabiting couples. A couple may have been together for many, many years and fully expect that they will have an interest in the assets or income of their partner. They may have an interest in property belonging to their partner if they can show that they have made a financial contribution to the property (including renovations) or to the outgoings on it, such as the mortgage and to a much lesser extent the bills. Alternatively a claim can be based on the parties’ intentions and the way that they have behaved towards each other. The present law is “complex, uncertain, expensive to rely on and, as it was not designed for family circumstances, often gives rise to outcomes that are unjust” (Law Commission). This gives rise to evidential difficulties and can result in expensive and lengthy court proceedings.
Please note, however, that if there are minor children, it is possible for a claim to be made under Schedule 1 of the Children Act for a lump sum or transfer of property.
Some other key differences between cohabitants and married/civil partnered couples:-
Children Unmarried fathers do not automatically get parental responsibility for their children unless the children were born after 1.12.03 and the father’s name is on the birth certificate. If the father marries the mother after the child’s birth, then the child will be legitimised by the marriage and the father will automatically acquire parental responsibility. Unless this is the case, it is necessary for the father to obtain parental responsibility either by entering into a formal Parental Responsibility Agreement with the mother or by commencing court proceedings.
Inheritance and Pensions Don’t forget that if you are not married you’re not each other’s next of kin. Some pension schemes will not pay survivor’s benefit to unmarried partners although the rules do vary from scheme to scheme. It is therefore an important point to check. Cohabitants are not entitled to a percentage of their partner’s pension contributions as is the case with divorcing couples.
A home left to the other cohabitee will be subject to inheritance tax on the proportion which is over the IHT threshold. Could the survivor afford to meet the tax bill without needing to sell the property?
If the deceased dies intestate (without a Will) then the cohabitee may find that they do not inherit anything at all, because they are not the deceased’s next of kin. The only exception will be for property held as joint tenants where the surviving co-owner inherits regardless of whether there is a Will. However, even then the deceased’s share of the property will attract inheritance tax if over the tax threshold. In cases of intestacy, the principal remedy for the cohabitant is to apply to the court under the Inheritance (Provision for Family and Dependants) Act 1975 and demonstrate that they have a need for money from the deceased’s estate.
What to do The Law Commission, which considers changes needed to the law, has proposed that there be legal rights for cohabitants upon separation or where one party dies intestate. This is the first step in a process which may result in a change to the law in a few years’ time.
Potential changes to the law The Commission’s view, as set out in their report “Cohabitation: The Financial Consequences of Relationship Breakdown” is that:-
It is much easier (and cheaper) to take simple steps now to plan what might happen if you were to separate or die and to avoid unforeseen consequences. There are some simple things that you can do NOW to minimise problems.
If you want your unmarried partner to have some of your assets after you die then it is essential that you make a Will because otherwise s/he will not be your next of kin. At the same time your solicitor will provide you with tax and estate planning advice to minimise the tax payable. Speak to the Private Client department
If the mother is the only person with PR and then dies, there will be no one with PR and it will be necessary for the father to make an application to court to obtain it, something which is an unnecessary burden at a difficult time. A PR agreement also reflects the value of the involved father in the life of the children concerned. Speak to the matrimonial department
If you are buying a house or moving in together, have a cohabitation agreement or deed of trust drawn up to state whether or not cohabitant A is to have an interest in cohabitant B’s property and if so for how much. Such an agreement can also provide for sale or transfer if you split up, in order to save on arguments further down the road. This is also a good idea if there is any possibility that one of you may become insolvent. Speak to the matrimonial department or your conveyancer
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