The Scottish Law Commission’s report on cohabitants in Scotland has now been published

We explained in our previous Insight article on 19 October 2022 that the Scottish Law Commission’s Aspects of Family Law Project were reviewing the law in relation to cohabitation. The Commission’s report with their recommendations and the Cohabitants (Financial Provision) (Scotland) Bill was published on 2nd November 2022. It is now before the Scottish Parliament with the Scottish Ministers for their consideration.

We explained previously that Scotland already has specific legislation in place for cohabitants contained in Section 26 – 29 of the Family Law (Scotland) Act 2006. We outlined what the current law is and what we considered the likely proposed reform may be. Were we on the right track?

Recommendations within the report

We had anticipated that the report would recommend changes to:

1. the definition of a cohabitant
2. the current time limit for making applications
3. whether there would be an option to order transfer property from one cohabitant the other
4. the method of how to calculate any claims.

All of these have been covered by the report and recommendation made. There are also additional recommendations made in relation to sections 25 – 28 of the Act. We will focus on the following:

The definition of a “cohabitant”

Currently a cohabitant is defined in section 25 of the Act as “a man and woman who are (or were) living together as husband and wife” or “two persons of the same sex who are (or were) living together as civil partners”. We are not surprised to learn that the report recommends that we step away from comparing cohabitants to spouses and civil partners and instead define them as “one of two persons who are or were living as a couple in an enduring family relationship”

The report suggests that in order for the court to determine if a couple is in an enduring family relationship, the court must have regard to all the circumstances of the relationship, including the duration of the relationship, the extent to which they live (or lived) together, the extent to which they are (or were) financially interdependent and whether the couple have a child or a child who is (or was) accepted as a child of their family.

The issue of time bar be reviewed

Cohabitants currently have one year from the cessation of cohabitation to “make an application” against their ex-partner. We considered that there may have been a recommendation that this time limit be extended or removed all together, given that no such limit exists for spouses or civil partners who separate.

The report recommends that the time bar for raising an application remain as one year. However, the court can consider a late application “on cause shown” for a period of up to two years following the cessation of cohabitation. We will need to wait and see what “on cause shown” will mean in reality.

In addition, cohabitants themselves can agree to extend the one year time frame by six months in order to negotiate a settlement between them.

Additional order for financial provision

The law as it stands does not allow for cohabitants who jointly own a heritable property to seek transfer of title of that property from joint names into their sole name upon separation. There is now a recommendation that, when making an order for financial provision, a court can allow property transfer orders.

In addition the report also recommends that the court can make:

• orders for the short-term relief of serious financial hardship for a maximum period of six months from the date of the order;
• incidental orders including for a property to be valued and sold; regulating occupancy of the family home and for use of its contents and liability for outgoings pending sale or transfer;
• interim orders;
• ancillary orders for financial provision

How to calculate any claims

We previously highlighted that there is currently no provision on how to calculate financial claims for cohabitants, in the same way that there is for separating spouses or civil partners, and that there is reference in the case law to “fairness” and to a “rough and ready approach”.

The report proposes a new test for the court to apply to ensure that orders are justified when applying their set of guiding principles, and reasonable having regard to the resources of the cohabitants.

Option to set aside or vary agreements

Whilst the reports seeks to distinguish cohabitants from spouses and civil partners – in terms of their definition - they have recommended that cohabitants have better protection, similar to spouses and civil partners and that they can seek similar remedies such as an order to set aside or vary cohabitation agreements (an agreement for financial provision) if the agreement or its terms were not fair and reasonable at the time they were entered into.

In our view, the most significant recommendations are for the amendment of the definition of “cohabitant”, the option for additional financial remedies upon cessation of the cohabitation including seeking a transfer of property and the recommended test.

What will happen next?

The report and draft Bill will now be considered by the Scottish Ministers. It is not known how long that process could take, if they will in fact choose to amend the current law and, if so, to what extent.

In the meantime, our Scottish team of experienced family lawyers are here to continue to advise our clients about the current law and about how we can help protect your interests now and in the future. Our colleagues in our English offices can also offer expert advice in England.