Plans for reform in the law for cohabiting couples

The Labour Party recently announced plans to reform the law for cohabiting couples should they succeed at the next General Election. A General Election will take place by January 2025.

We consider what changes might be introduced and how this may affect cohabiting couples and outline how disputes are currently decided.

What is the current law for cohabiting couples?

Many people believe the “common law” marriage myth that they obtain legal rights in respect of their partner after living together for a certain period of time.  There is no such thing as a “common law” marriage. This is a common misconception.  Cohabitants have very limited legal rights compared to married couples in relation to their partners income, assets and pension upon separation or death.  

Living together as a couple (whether same-sex or heterosexual) does not automatically grant an interest in a property.  At present cohabiting couples have to make a claim under the Trusts of Land and Appointment of Trustees Act in respect of property or under Schedule 1 of the Children Act 1989 if the provision sought is for the benefit of a child. Unlike married couples, or those in a civil partnership, there are no general rights to make a claim for financial provision if there is a breakdown in the relationship. 

When purchasing a property in joint names a decision will need to be made as to whether to hold the beneficial interest in the property jointly or as tenants in common.  If you hold the property as joint tenants this means that you have an equal right to the whole property and your share of the property will pass automatically to the surviving owner if you die.  If you hold the property as tenants in common you can have different interests recorded in the property and if you were to die, your share will pass under the terms of your will (or intestacy if there is no will in place).

Issues often arise when one party purchases the property in their sole name with the other party contributing to the purchase price or the monthly mortgage payments and expects to have an interest in the property.  There are also issues where couples contribute unequal amounts and do not record anywhere their intention for their initial contributions to be returned. Further difficulties arise when a cohabitant moves into a property already acquired by the other cohabitant and in these circumstances legal advice is often not sought.

Quite often one partner (usually the woman in a heterosexual relationship) will remain in an unhappy and abusive relationship because they do not feel financially able to leave their partner due to the current limits of the law.  If you live together, you do not have the right to access monies held in your partner’s bank account, similarly there are no automatic rights upon death and as an unmarried couple wills will need to be made if you want to leave part of your estate to your partner.

What is the process currently for cohabiting couples dealing with property?

There are many important cases already decided by Judges over many years that affect how these issues are approached. Not all judges have taken a consistent approach and the law is evolving. There is also statutory law, the Trusts of Land and Appointment of Trustees Act 1996 commonly referred to as TOLATA, which sets out criteria to assist how to resolve these issues and which has affected how cases are decided at Court.

The first question is always whether there has been any agreement or arrangement recorded in writing.  Ideally, this would be recorded in the register of the property ownership or in some form of agreement signed by both parties. Often this has not been recorded in writing, even if there have been discussions between the couple. More often this is missing as those discussions have not taken place. 

If there is no written agreement recording how the property is owned, it will be essential to look for evidence that throws some light on what was intended. Were there discussion between the parties? Are there text messages, emails, or references in writing in cards or letters between the couple that support one partner’s assertion that there were discussions between the couple about what they agreed and intended to happen with the property.

If there is no evidence to support that there was an agreement or arrangement to share, it would then be necessary to look at how the parties conducted themselves from the time they were cohabiting. Were there direct contributions to the purchase price by the partner whose name is not on the title deeds? If the property was bought by one partner before cohabiting, did the other partner contribute towards the mortgage payments after they moved in? Evidence of how the cohabiting couple shared their finances generally, how they paid for outgoings on the property and how they shared the cost of living can also be used as evidence to infer what was intended even if this hadn’t been expressly discussed. Did arrangements change during the relationship? What affect did any change of circumstances have on the shared intention or understanding about the property?

Unfortunately, these types of disputes depend heavily on “he said/she said”. Often the credibility of a witness is a crucial factor as it affects how believable a person’s evidence is.  if an agreement cannot be negotiated through solicitors and mediation, a claim can be issued in a County Court to decide what the intention was inferred from conduct.  Naturally, this is high risk and acrimonious and can be very expensive.  Court proceedings should always be a last resort.

Couples who have separated may try to rely on messages between the couple after they had separated or between friends and family after separation. Most often, these types of communications are regarded as “self-serving” as the dispute has already formed.  The most credible form of evidence is what was discussed or can be inferred from the parties conduct at the time they start cohabiting and long before the couple separates.

The person whose name is not on the property register has the burden of proof to establish that the equity in the property should be shared differently from how the legal title to the property is owned. Can they show that they relied upon an arrangement or intention to share the property, and have they relied on this understanding to their detriment?

These cases are decided on the facts specific to each couple and credibility of witnesses and evidence.  That can make it very difficult to predict the outcome. This can make it high risk for all involved.

What might reform look like?

• Whether contracts (such as cohabitation agreements) between cohabitees dealing with parties’ respective shares in a property should be legally enforceable;
• Increased rights to accessing financial support in the event that the relationship breaks down with remedies such as periodical payments, lump sums and property transfers;
• Changes in financial provision for the benefit of children under Children Act 1989;
• The possibility of an automatic right to inherit upon death where a cohabitant dies intestate.

Should there be reform?

Since 1996 the number of cohabiting couples has more than doubled. The proportion of couples who are married has decreased.  With more couples choosing to cohabit as opposed to marriage this further shows the need for there to be reform.  The current law is very complex and despite a number of recommendations we are yet to see any change.

Scotland and Ireland both have legal frameworks in place protecting the rights of cohabiting couples.  Whilst there are ways for cohabiting couples to protect their financial position in England and Wales by way of cohabitation agreements and deeds of trust, there is still a need for a change in the law as although deeds and agreements are beneficial, circumstances can change throughout a relationship and it is not always possible to account for all unexpected changes.

It is hoped that the government will consider the many different types of cohabiting relationships when proposing changes to the law.

How Pinney Talfourd can help

Pinney Talfourd are experts in Property Litigation and Family Law and can advise you on changes to the law, so you are given up to date advice.

For more information, please contact either Lisa Eastwood, Senior Associate in the Property Litigation team or Family Solicitor, Jade Mercer.