According to the latest ONS, divorce rates in 2022 fell by 30% from the previous year’s figures, and are now at their lowest level since the early 1970s. Conversely, the number of couples who cohabit has more than doubled in the last 30 years. The result of this is that one fifth of couples who now live together are cohabiting, rather than being married or in a civil partnership. Given these numbers, it is important to debunk the commonly held misconception around “common law” rights.
The widely held assumption of many unmarried couples is that they acquire “common law” rights similar to those of married couples simply by virtue of being in a long-standing relationship. This is wrong.
In England and Wales, it is only people who are married, or those in civil partnerships, who acquire legal rights and responsibilities in relation to each other, which then mean that they can then make financial claims against each other in the event of the marriage or partnership ending in divorce or dissolution.
For unmarried couples, their rights and responsibilities are more limited, and often stem solely from how property is legally owned. As a result, cohabitants who don’t own property jointly with their partner often face a reality which is starkly different from their expectations if the relationship comes to an end, and they realise they cannot rely on their “common law” position. In those circumstances, they face going down the route of having to prove that they have a financial interest in property owned by the other party, and unless there have been direct financial contributions to the purchase price, or subsequent renovation costs, the process is not straightforward, and can be lengthy and costly exercise. What is more, it is not always possible to show that such an interest exists, which can leave the non-owning party in a very precarious position.
To avoid such a situation arising, cohabitants who are living in a property owned by just one of the parties should consider entering into a Cohabitation Agreement, which can provide clarity around property rights, and responsibilities in relation to each other, both during the relationship and in the event of the relationship breaking down.
Whilst not the most romantic topic of conversation for those who are contemplating living together – or even for those who are already cohabiting – it is as well for the head to be involved in decisions, as much as the heart.
Perhaps it is best to think of a Cohabitation Agreement as an insurance policy. The hope is that you don’t need to call on it, but are grateful that it is there if you do. Please do not hesitate to get in touch if you would like to discuss this further.
