Cohabitation – The Risks and How to Avoid Them.

More and more couples are choosing to live together rather than getting married. The problem though is upon separation cohabiting unmarried couples do not have the same claims against each other as married couples do. For some this may be the appeal as they do not want their partner to have any claims against their assets should the relationship fail but for others they may THINK they have similar claims to married couples when they don't.

If you own your home in your sole name and your partner moves in with you it would be sensible to have a Living Together Agreement drawn up and this puts the financial arrangements on a more formal footing.  The Agreement will set out who is responsible for paying the mortgage and household bills and sets out what happens to the property in the event of a separation - does the non legal owner have a share in the equity of the property or more usually that they do not have any claims or entitlement against the property.

Difficulties arise in situations where one partner, for example the girlfriend has moved into her boyfriend's home which he owns in his sole name and she has been contributing towards the mortgage and household outgoings for some years.  The relationship breaks down and the boyfriend wants his now ex girlfriend to move out of his home and she wants a share of the equity in the property.

If they were married the property would be the matrimonial home and as his wife she could claim an interest in the property.  However as they are not married the only remedy lies in the complicated area of trusts law and the girlfriend would have to establish that she has what is called a beneficial interest in the property.  These types of proceedings can be costly but all too often couples have not put their financial arrangements on a formal footing and these disputes do arise.

If you have any questions concerning cohabitation or Living Together Agreements please contact Amanda Weaver on amandaweaver@newleafsolicitors.co.uk or call 01788 555042.