If a couple are married or in a civil partnership there is clear law on how finances can be resolved if they decide to part.
For co-habitees there is no one law to help them. Should there be one? I think the Government should now be considering a law for co-habitees.
There are lots of arguments which suggest that if people wanted to be bound by law they would get married. If a couple are living together and don’t have any children, I agree they can arrange their finances however they like and keep what they had if they part. However, it is very different when a co-habiting couple have children.
What is the present law for cohabitees?
If a couple are not married, engaged or in a civil partnership they do have access to certain laws.
If there is a property which they own jointly they can deal with any disputes on that under Trusts of Land and Appointment of Trustees Act 1996 although it would have been preferable when they purchased it if it was not to be in equal shares to have made that very clear on the registration at the Land Registry and a Declaration of Trust. If the property is in one person’s name but the other has made significant contributions to the property itself then this can also be addressed. However, it is not simple and may involve going back many years trying to find receipts and who paid the builder for building the extension.
Cohabitee disputes involving possessions
If a co-habiting couple are in a dispute over items in their home this has to be dealt with on an item by item basis. Who owns it? Generally, the person who purchased it. Therefore, if you go out together and one person buys the nice clock that you put on the mantelpiece, but the other pays for dinner; the purchaser of the clock will own it and will get no adjustment against his or her clock for having eaten a dinner paid for by the other one.
The current law doesn’t reflect modern living. Couples live together, they buy items, they furnish a home, they do not keep all these details. They have not structured their lives in a way that facilitates sorting them out under the structure of the present law available to them.
If they have children, the person who has the care of the children can make applications under Schedule 1 of the Children Act. This can include provision of a home for the children to live in, or a car or other items they might need. However, this is only for the duration of the children’s minority and for example the home provided has to revert back once the children are grown up.
It is time for there to be a law for co-habitees. There are already many existing definitions of co-habitation as this has been addressed in the matrimonial Courts for many years.
The determining factor could be the birth of children. At that point a couple need to be able to access a law for co-habitees which could be an overarching law to enable them to address all of the financial issues that arise on their separation. Married couples and civil partners have the Matrimonial Causes Act Section 25. This sets out the criteria for the Court consider. This provides that in deciding finances the Court will consider:-
- the income, earning capacity, property and other financial resources of each and how this is likely to change in the future;
- the financial needs, obligations and responsibilities which each have or are likely to have in the future, i.e. taking into account the age of any dependent children;
- the standard of living which existed prior to the breakdown of the marriage;
- the age of each and the length of the marriage;
- any physical or other disability which either may have;
- the contributions which each have made or are likely to make in the future to the welfare of the family, including any contribution made by looking after the home or caring for the family;
- the conduct of either.
We have to ask ourselves why can this not be applied, in a new law, to co-habitees once they have had children.
Up until the time they have children it is often the case that both have jobs, are independent and make their own financial decisions. Once children are born they make decisions that reflect the care of the children. Neither probably makes these decisions thinking how they will work out if they break up. Therefore, one partner (either the mother or the father) will make decisions to defer a career or work part time to care for the children. They are then disadvantaged by the relationship if they break up 10 or 15 years later on. Relationship disadvantages are a major factor for consideration in divorce proceedings and yet the co-habiting couple may very well have done the same thing.
It could be argued that they have chosen not to be legally bound by existing laws in not marrying. However, for many couples it is simply not considered and at the commencement and during the relationship they are not making decisions contemplating what will happen at the end of it.
Any new law should include provision for there to be pension sharing on the break up of co-habitation. If a couple have been together for 20 years and one person has been caring for the children while the other has been able to build a pension pot, At the moment there is no access for the one without the pension to be able to obtain a pension share of the other’s pension, and indeed no entitlement to it whatsoever.
It is time for the law to address modern living.