Many people in England and Wales believe unmarried couples that live together have the same legal rights as couples who are legally married or who are in a civil partnership. This myth is referred to as “common law marriage”. The truth is that cohabitation does not provide any legal status to couples living together, regardless of how long they have lived together and whether they have children. Unmarried couples therefore risk being left legally and financially vulnerable if their relationship breaks down.
In England and Wales, there are few mechanisms in place to assist unmarried couples when their relationship ends. Married couples are governed by the Matrimonial Causes Act 1973 which outlines how their assets will be divided fairly upon divorce. This includes claims in relation to each other’s capital, pensions and income. When unmarried couples separate, they do not have the same rights.
The most common area of dispute is ownership of the family home. If one party does not own the home either solely or jointly, they do not automatically have an interest in the property. This is the case even if one party has contributed a significant amount of money towards property, for example, by paying the deposit, mortgage or household bills.
There are however ways in which couples can protect themselves against this risk:
Cohabitation Agreement
A cohabitation agreement sets out a couple’s joint intentions as to how their finances will be managed during their relationship. It can also include provision as to what is to happen in the event their relationship ends. A cohabitation agreement can be bespoke for each couple and can be adapted to suit the majority of circumstances.
Declaration of Trust
A declaration of trust is a legally binding document which sets out how a property is owned and in what shares. A declaration of trust records the position if a couple is contributing unequal shares towards things such as the purchase price, mortgage payments or any renovations. This allows for the funds to be returned as agreed in the event of sale of the property.
If a couple enters into a cohabitation agreement or a declaration of trust and subsequently marry each other, the documents should be revised to reflect this change. It is important to note; however, that the laws regarding divorce will override any cohabitation agreement or declaration of trust.
For either a cohabitation agreement or declaration to be upheld, it is important for both parties to seek legal advice. Should you require any legal advice as to which option best suits your family, please do not hesitate to contact our Family Law team at Martyn Prowel Gartsides Solicitors on 029 2047 0909.
Prepared by Georgia Quick