Now that the title has caught your attention, let us be clear, the term “common law spouse” is a misnomer.
Reliance on the mistaken belief that being a “common law spouse” provides financial protection has caused disappointment in some and elation in others!
Many people cite their reason for deciding to cohabit rather than marry as a disillusionment with the institution of marriage, particularly given the high divorce rate and emotional and financial turmoil often involved in the dissolution of a marriage. As such, the number of couples electing to cohabit has increased year on year.
In this article, the reference to marriage (and spouse) should be read as including a civil partnership, as both offer substantially the same benefits, or, depending on one’s perspective, pitfalls!
Setting up a home
Most couples commence their relationship by purchasing a property. As a cohabiting couple, the person whose name appears on the deeds owns the property and is entitled to deal with the property as they see fit. The other party has no legal right to occupy the property and no share in the equity of the property. In the situation where the non-owner partner has contributed capital towards the property, it may be possible to recover these funds, however these situations will often result in costly and lengthy litigation.
In order to regulate a cohabiting couple’s property rights, a declaration of trust may be concluded. This would clearly set out each party’s beneficial interest in the property and how the proceeds of the property would be divided in the event that it is sold.
By contrast, married couples have a legal right to occupy the matrimonial property in terms of the Family Law Act 1996 and will also have a share in the equity, regardless of whose name appears on the deeds of the property.
Financial support
Cohabiting couples have no legal duty to support each other financially, either during the relationship or thereafter.
Married couples have a legal duty to support each other financially and this duty extends until terminated by a court.
Wills and probate
Cohabiting couples may benefit each other in their will; however, the surviving partner will not benefit from an exemption from inheritance tax as a surviving spouse would and the person may at any time change their will without any notice to previously intended beneficiaries.
Where a partner in a cohabiting relationship dies without a will or does not benefit the surviving partner in their will, it may be possible for a surviving partner to make a claim against the deceased partner’s estate under the Inheritance (Provision for Family and Dependants) Act 1975, however this would often necessitate costly and lengthy litigation.
Married couples have a right to inherit from each other in the event that they die without having left a will. When a spouse excludes the surviving spouse from benefitting under their will, the surviving spouse is able to bring a claim in terms of the Inheritance Act mentioned above. As a surviving spouse, the prospects of success with such a claim are significantly better than those of a surviving partner in a cohabiting relationship.
Conclusion
Whilst there have been submissions made by the Law Commission to the Government proposing the introduction of legislation to govern the legal position of cohabiting couples, there is at present no legislation and accordingly, very little protection.
Currently, the most appropriate method for cohabiting couples to regulate the financial consequences of their relationship and termination thereof, is through the conclusion of a cohabitation agreement. The cohabiting couple may tailor their agreement to suit their circumstances. Provided that the cohabitation agreement complies with the fundamental principles for a valid contract, the courts are most likely to enforce it.
Admittedly, no couple in the bliss of romance wish to attend at the offices of a solicitor to discuss their pounds and pennies, however it will clarify each party’s rights and obligations (and expectations) during, and more importantly, upon termination of the relationship.
Not all is fair in love and war.
