A quick guide to cohabitation law in Scotland
This insight aims to outline some significant aspects of the existing cohabitation law in Scotland.
While this has been an area of law which has been under review recently by the Scottish Law Commission, it is envisaged that it will be some time until there is any substantive progress towards actual legislative reform.
The existing provisions, which are within the Family Law (Scotland) Act 2006, (the Act), are therefore likely to remain for the foreseeable future.
Scotland has specific legislation which provides cohabitants with certain rights and allows them to make certain claims when they cease to cohabit, i.e. separate. The rights are in respect of money, household goods, belongings, joint accounts, and savings. The legislation also includes rights and claims following the death of a cohabitant.
The types of claim are limited, and this is a difficult area of the law to navigate, but we hope to outline some significant aspects of the existing cohabitation law in Scotland.
Who is a cohabitant?
This is defined within S.25 of the Act, meaning a couple consisting of:
- A man and a woman who are (or were) living together as if they were husband and wife; or
- Two persons of the same sex who are (or were) living together as if they were civil partners.
There is no further definition apart from some guidance in the event a court is required to determine whether a person is a cohabitant. Regard should be had to:
- The length of the period during which the parties have been living together (or lived together).
- The nature of their relationship during the period, and
- The nature and extent of any financial arrangements subsisting, or which subsisted, during that period.
As will be appreciated from this definition, this is limited in scope and also rather out of date. The guidance is very vague. We can all probably identify what we may consider to be cohabitation, i.e. living together, but there are varying living arrangements in varying circumstances which occur in modern society.
While there is an indication within the Scottish Law Commission Report that the definition should be changed, this has not yet occurred.
Generally, a consideration of the living arrangements and particular circumstances of the parties will need to be considered as to whether the couple fall within the existing definition. There is little case law to assist, so it will be a consideration of a couple’s own particular, factual, living arrangements and circumstances which would be considered.
What rights are provided?
S.26 and S.27 of the Act provide rights in certain household goods and on certain money and property.
There is a presumption that a cohabitant has a right to an equal share in household goods acquired during the period of cohabitation. Household goods is defined at S.4 of the Act to include any goods (including decorative or ornamental goods) kept or used at any time during the cohabitation in any residence in which the cohabitants are (or were) cohabiting for their joint domestic purposes.
There are however exclusions which are:
- money;
- securities;
- any motor car, caravan, or other road vehicle; or
- any domestic animal.
In respect of money which has derived from any allowance made by either cohabitant for their joint expenses or similar purposes, or any property acquired out of such money, there is also a presumption that it will be treated as belonging to each cohabitant in equal shares. However, there is a specific exclusion being that this does not apply to a residence used as the sole or main residence in which they live (or lived) together.
What claims can be made?
The Act provides that claims can be made for financial provision where the cohabitation ends otherwise than by death. This is in S.28 of the Act.
S.29 allows an application to be made to the court by a survivor for provision in the event that the deceased cohabitant died intestate. This means that the cohabitant died without leaving a Will.
The claims for cohabitants are limited and do not equate to the type of financial provision claims that can be made by spouses or civil partners.
A claim can be made for a capital sum of a specific amount or for an order requiring a former cohabitant to pay such amount in respect of any economic burden of caring, after the end of cohabitation, for a child of whom the cohabitants are the parents under S.28 (2)(a) and (b) of the Act.
Certain matters have to be taken into account when assessing if a capital sum can be claimed, which are not straightforward to understand. The claim is as a result of contributions. Consideration has to be given as to whether one party had derived an economic advantage from the contributions made by the applicant. Further, whether the applicant has suffered economic disadvantage in the interests of the other party, or any relevant child. However, it is complicated further in that any economic advantage requires to be offset or balanced against any economic disadvantage suffered by the other party in the interest of the applicant, or any relevant child.
This means that an analysis of contributions made during a cohabitation needs to be undertaken, as the ultimate exercise to is to address any financial imbalance arising from parties’ contributions and whether they have been economically advantaged or disadvantaged.
A cohabitant can make a claim against the deceased cohabitant’s estate for payment out of the deceased’s net intestate estate of a capital sum. There is also provision for the transfer to the survivor of such property, whether heritable or movable from that estate. There are other matters to be considered in respect of such a claim which are:
- the size and nature of the deceased’s net intestate estate,
- any benefits received as a consequence of death, e.g. payment of an insurance policy,
- the nature and extent of any rights against the estate by others,
- and any other matter the court considers appropriate.
There is little guidance and case law in existence regarding such claims upon death.
What are the time limits for making a claim?
A claim for financial provision which is not as a result of death must be made within one year of the date when cohabitation ceased, i.e. the date of separation. According to case law, this means that a court action must be raised, warranted by the court and served before the last day before the one year date from the date of separation. The time limits are very strictly applied and if missed the case cannot proceed further as it would be time barred.
In respect of a survivor’s claim on an estate, this needs to be undertaken within six months of the date of death.
In the event of separating from a cohabitant, legal advice should be sought as soon as possible.
What should I do if I am contemplating living with my partner, or making arrangement to commence cohabitation?
It would be prudent to consider whether there are matters which will or could arise during your cohabitation which can be regulated by way of a Cohabitation Agreement, e.g. if you were making a substantial contribution to a deposit to purchase a property which was unequal then you may wish to ensure that if a property is being bought in joint names that this is recorded, especially what will happen in the event of your separation. Provision can be made for repayment or dividing any proceeds unequally.
A Cohabitation Agreement can regulate many matters, such as who is paying what household expenses, what should happen to heritable property if you separate, i.e. should it be sold or transferred to one of the cohabitants.
A Cohabitation Agreement could also regulate specifically what is to happen in the event of separation. A Cohabitation Agreement can give clarity, record contributions, ringfence assets, and regulate and control future arrangements to avoid uncertainty.
What is the general test?
The test is fairness, although these words do not actually appear within the Act. The court has a very wide discretion in applying the law. Many cases are resolved by negotiation due to the uncertainty of decisions in a court context.
Can I seek a transfer of a house/home which is jointly owned?
The existing cohabitation law does not allow a transfer of a house to be sought when cohabitation ends without death. Only a capital sum, i.e. lump sum, can be sought.
You can therefore not ask a court to order a transfer of a home which is jointly owned.
In the event of a house being jointly owned, the only existing remedy is an action for division and sale. This generally orders a sale when a property is not capable of being divided.
There is no mechanism within the existing law to allow a property to be transferred to one party. This is why it may be important to regulate what may happen in the event of a separation by way of a written Cohabitation Agreement. Provision can be made for a transfer by agreement.
Concluding thoughts
As indicated, while there is a potential change to the law coming, unfortunately it is likely to be a few years before the Scottish Government proceeds to amend the current law, if they ultimately decide to do so.
In the meantime, our Scottish team of experienced Family lawyers can advise you about the current law, the up-to-date case law, how to defend or pursue a cohabitation claim and about how to best protect your interests by advising you in respect of the preparation of a Cohabitation Agreement.
Taking steps to regulate matters and to clarify matters before you live together may hopefully avoid very contentious and litigious disputes in the event your relationship comes to an end.
If you'd like advice on any aspects of Cohabitation Law in Scotland, please contact our Scottish family lawyers.