Proposed reform to the rights of cohabitants in England and Wales
Despite the large number of cohabiting couples in the UK, there is still no comprehensive legislation dealing with the separation of cohabitants.
A recent report from the House of Commons Women and Equalities Committee has highlighted a concern, so often voiced amongst legal professionals, that cohabitation laws are now hugely outdated and fail to recognise the needs and social reality of modern family dynamics.
The report calls for urgent reform of cohabitation laws and for a campaign to raise public awareness of the inferior legal rights currently afforded to cohabitants in contrast to their married counterparts.
Why does it matter?
The urgency of such a campaign cannot be questioned when consideration is given to the following staggering statistics:
- 46% of those in England and Wales wrongly believe that living with a partner affords them rights by way of a ‘common law marriage’ when, in fact, there is no such thing;
- The above figure rises to 55% where the household has a child – this means more than half of parents in this country are operating under a misapprehension as to their rights on separation; and
- Some 20% of all couples in the UK are living together and choosing not to marry or enter into a civil partnership. The laws surrounding cohabitation therefore have a wide reach.
What is the current situation?
Despite the large number of cohabiting couples in the UK (an increase of 50% since the 1990’s) there is still no comprehensive legislation dealing specifically with the separation of cohabitants. This stands in stark contrast to divorce or dissolution which is governed by the Matrimonial Causes Act 1973. Instead, cohabitants and their lawyers are forced to find their way through a complicated array of property, trust and Children Act legislation in an attempt to find a solution, often not resulting in fairness.
Instead of the discretionary system that applies on divorce or dissolution, which has a focus on a fair outcome, property and trust law is restrictive and can result in one party leaving the relationship severely prejudiced financially. Whilst it may be possible to establish a claim in relation to a property where financial contributions have been made, disputes are notoriously expensive to resolve and outcomes uncertain.
There are also assets that a cohabitant will simply have no rights to at all. For example:
- after a long marriage, pensions are invariably shared on divorce or dissolution, to ensure fairness on retirement. In contrast, a cohabitant would have no claim to a share of the other’s pension. It would be preserved in full by the legal owner.
- In the event there are children, child maintenance will be available irrespective of whether the parents are married but it is important to be aware that there is no right to spousal support irrespective of how long a couple has lived together and irrespective of the financial sacrifices one party may have made for the benefit of the family unit.
What does the report recommend?
There are two key components to the Commission’s recommendation.
The first is to raise public awareness of the differences in the rights afforded to cohabitants. This will avoid people relying on misconceptions and only becoming aware of their more limited rights once it is too late.
The second is to implement changes to the law in order to improve the rights of this portion of the population. In that regard the Commission specifically recommends:
- An opt-out cohabitation scheme to protect the rights of cohabitants and in particular those who are economically vulnerable;
- To reform Schedule 1 of the Children Act 1989 which provides limited provision for cohabitants where there are children but is often viewed as problematic because it tends to be used as an option where the parties have some wealth;
- Reforming the laws in relation to death and intestacy to ensure that cohabitants are recognised on the death of a partner; and
- Creation of a clear legal definition of cohabitant to provide certainty over who would qualify under the new legislation.
What does this mean for me?
Unless and until the reforms become law, cohabitants remain in a precarious position in the event of separation. It is therefore very important to ensure that specialist legal advice is sought so that protective measures can be put in place, whether as the financially stronger party looking to preserve their wealth or as the financially weaker party looking to ensure that they are not left in a vulnerable position.
A solicitor can assist with ensuring that any financial contributions to a property are protected by way of a declaration of trust.
They can also assist with the preparation of a cohabitation agreement so that both parties can have certainty in the event of separation and avoid expensive disputes.