If you are living with someone or are contemplating living with someone with whom you are in a relationship but who you are not married to, or in a civil partnership with, it is advisable to consider taking steps to protect your financial interests.
Although there is frequent reference to concepts of ‘common law marriage’ and ‘common law husband or wife’, the fact is that there is no such legal concept in this jurisdiction and there never has been.
Cohabitation agreement law in the UK
In a situation where the parties to a relationship are not married or civil partners and their relationship has broken down, the governing law relating to financial and property matters is entirely different from the family law legislation which is applicable following the breakdown of a marriage or civil partnership.
A property dispute between non married partners will be resolved by reference to general property law and any financial dispute can be dealt with through the civil courts but not in the family courts. This does not apply to the financial and housing needs for any children of a relationship where the parents are not married or in a civil partnership and remedies can be sought under Schedule 1 of the Children Act 1989.
Although there has been thought given to correcting the situation and providing a higher level of legal remedy in financial and property disputes between cohabitees or former cohabitees, meaning people who live together in the same household, the law has still not developed to provide any substantial additional legal protection in respect of property or financial disputes.
If you are contemplating entering into a relationship in terms of living together, then you may wish to consider entering into a formal cohabitation or living together agreement to govern what is to happen with regard to property and money should if the relationship break down.
Where the parties live in a property which they own jointly, in whatever ratio and the relationship breaks down, there are often difficulties between the parties as to how the property should be sold, at what price and how the proceeds should be divided. It is important when you are buying a property with a partner or any individual that you are not married to, or in a civil partnership with, for the parties to seek separate legal advice on whether the proposed home should be purchased jointly or as tenants in common.
Ownership of a property as tenants in common means that you each own a separate portion of the property and in line with any percentage of ownership agreed. Purchasing as joint tenants will mean there is a presumption you own the property equally (unless proven otherwise) and that you are each entitled to one half of the net sale proceeds. The courts cannot usually interfere with agreements reached between parties who are not married or in a civil partnership and made with regard to division of ownership or with how the ownership has been recorded at the Land Registry, save in quite limited circumstances.
As cohabitees purchasing a property with their partner will not be afforded the same protection as in family law, they should consider from entering into a formal cohabitee or living together agreement to avoid expensive and difficult disputes if the relationship breaks down.
“Living together without being married or being in a civil partnership means you do not have many rights around finances, property and children. Consider making a will and getting a cohabitation agreement to protect your interests.”“Cohabitation – Your Rights”, Law Society online guidance
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You should consider a formal written agreement to include protecting yourself with regard to your home and financial position should the relationship break down. Any financial contributions you might make or be asked to make, may well not provide you with any beneficial ownership in the property or any long-term protection should your partner demand that you leave. You should also take legal advice on steps you can take to protect your financial position if you are contemplating starting a family but not marrying or entering into a civil partnership.
Whether you own the property as ‘joint tenants’ tenants in common you are legally entitled to insist on a sale of the property and if necessary, you can obtain a court order compelling sale. The position may be different where there are children of the relationship.