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A Valentine Cohabitation Story

A Valentine Cohabitation Story
9 February 2018

Are you in a cohabiting relationship?  Have you and your partner signed a cohabitation agreement?  If you run a business together do you have a written statement of your stake in the business?  If not, then it really is time to think about it.  It isn't unromantic: it's the practical, sensible and adult thing to do.

The court case of Pamela Curran and Brian Collins from last year highlights, yet again, how disastrous and distressing it can be when an unmarried couple split up and rely on the courts for a 'fair' division of shared assets.  Ms Curran and Mr Collins had been together for 30 years, sharing a family home and running a successful kennel business together.  Both their home and the business were in Mr Collins' name.  When they split up Ms Curran got ... nothing.  

There are many misconceptions about the legal status of unmarried or 'common law' couples.  The sad fact is that the law does not recognise a cohabiting relationship in the same way as a marriage or civil-partnership.  When a cohabiting couple split up each party retains the assets held in their name.   In order for Ms Curran to have been successful in her appeal she would have had to show that she and Mr Collins intended for her to have a share in the family home and business.

What can be done about it?  Well, short of waiting for Parliament to introduce new laws to address the problem (which is a possibility), anyone in a cohabiting relationship should make sure that they and their partner have written agreements in place that clearly set out each partners' stake in their shared assets.

A cohabitation agreement can be used to specify the couples' intention as to how assets acquired during the relationship, such as a home, should be split if the relationship ends.  Such agreements are not yet legally binding in the UK but the courts are, more and more, taking note of cohabitation agreements when considering the division of assets.  It's worth considering drawing up a cohabitation agreement with your partner if you own a home together.

If you and your cohabiting partner run a business together then you should also have a legally binding agreement in place which sets out each partner's share in the business. A simple way to do this would be with a business partnership agreement.  Other business structures such as a limited liability company or limited liability partnership could also be used, but are a bit more complicated to set up and administer since they have to be registered with Companies House.

And don't forget about writing a will.  We've been talking about what happens when a couple splits up but the other, more romantic, aspect is thinking about couples who spend their whole lives together.  If a cohabiting partner dies intestate (without a will), the remaining partner is not automatically entitled to inherit and would have to apply to the court to get anything at all.  Unmarried couples who wish their partner to inherit any of their estate should document their intention in a will.

As always, if your need legal advice do speak to a solicitor.  If you're looking to draw up a will, cohabitation agreement or business partnership agreement then we offer a range of templates that can help.

Being in a loving relationship is certainly something to celebrate this Valentine's day.  Just make sure that you've also thought about you future together and your financial security.


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