COHABITATION AGREEMENTS
In England and Wales, cohabiting couples do not automatically gain interests in property, as seen with conventional marriage, leaving unmarried couples vulnerable.
Within the last 20 years, cohabitation rates have doubled in the UK. Couples are getting married less today than ever before. But the law has not adapted to our changing landscape, leaving cohabitants vulnerable if the relationship breaks down, leaving you exposed to losing treasured possessions, such as pets or gifts.
A Cohabitation Agreement provides contingency plans for the nuances of your life. Therefore, these agreements are provided for with such as a declaration of trust or a Will.
What you should know:
Who needs a cohabitation agreement?
Romantic relationships are not required, nor familial, to have a legally binding and enforceable cohabitation agreement.
Although cohabitation agreements are primarily used by young couples, these agreements can be critical in adding certainty to any non-marital cohabitation, including joint investments in property or ownership of property as friends.
Examples:
- Billy paid £90k for a loft extension. He wants to be compensated for this investment if he and his girlfriend Sally separate, as she did not contribute to the extension.
- Sandra’s dog, Fido, was purchased with her girlfriend when the house was bought. Sandra dedicates all her time to the dog and is concerned that her girlfriend may try to keep Fido if they separated.
- Mo’s parents paid £10,000 as a gift for all the home’s curtains. They want Mo to have the rights to these curtains if a separation happens.
What Do Cohabitation Agreements Contain?
- The names and details of both parties.
- Confirmation that both parties are living together or soon will be, and the document will be legally binding.
- Confirmation that both parties sought independent legal advice.
- A schedule of the property fittings, including assets each person has acquired independently before moving in.
- How property and assets should be divided upon separation and the sale of property.
- Details on a party’s nomination to access pensions.
- A breakdown of living expenses and who is responsible for paying these monthly.
- Details on the sale process and how it should be conducted.
- A breakdown of how utility payments, mortgage payments, and taxes should be paid during the sale process.
- Arrangements for debts (current and future).
- Arrangements for the ownership of heirlooms, chattels, and pets.
Why You Should Consider a Cohabitation Agreement with Gifford Cairns
Protection from Future Claims – If you are a clever cohabitant, your agreement should record your mutual intentions with the property, your equity in the property, and it should map out arrangements, including the sale process and provisions for pets should your relationship break down. The agreement should be amended regularly to reflect life changes.
Such agreements are fundamental in defending claims where greater shares of equity are claimed based on external factors, such as earlier promises made or ongoing financial contributions.
Certainty and Peace of Mind – This agreement will provide you with a clear and mutually agreed roadmap from the outset of such a significant investment, granting you peace of mind and recourse if the relationship breaks down. These agreements are also essential at quelling the anxiety experienced by parents, who often fund property purchases and want to protect their children’s interests.
Protecting Treasured Items – Couples often acquire possessions of significant sentimental or financial value, such as pets, artwork, or heirlooms. Without a clear agreement in place, disputes over ownership can arise in the event of separation, leading to legal uncertainty and potential conflict.
When it comes to pets, the law views them as property, meaning that without a formal agreement, one party may retain full ownership, regardless of emotional bonds or shared responsibility. A Cohabitation Agreement can clearly set out ownership rights and future arrangements, ensuring that valued possessions and beloved animals are protected from unnecessary disputes.
Client-Focused Approach – At Gifford Cairns, we prioritise a thorough and personalised service. We take the time to fully understand each client’s individual circumstances, ensuring that legal solutions are tailored to their specific needs.
Clients are invited to discuss their concerns in a professional and supportive environment, where we work collaboratively to develop clear, practical agreements that provide long-term security. Our approach is not only focused on legal precision but also on fostering clarity and fairness in personal and financial matters.