Cohabitation Agreements

Cohabitation Agreements

In England and Wales, there is a widely held misconception that if a couple lives together then they are classed as ‘Common Law’ partners and therefore have the same legal rights as married or civil partners. – This is not the case.

Couples who do not wish to enter into a marriage or civil partnership can still obtain some protection in the event that they split up and this can be provided through a cohabitation agreement.

Here we answer some of the frequently asked questions regarding Cohabitation Agreements.

If my partner and I enter into a cohabitation agreement, what does this mean?

A cohabitation agreement outlines which assets are owned by whom within a relationship, whether jointly or solely, and provides the opportunity to document how the parties agree these assets should be distributed in the event of a relationship breakdown. It can also specify arrangements regarding the maintenance of children, joint finances, property and other significant assets.

Will my partner inherit my estate if we have a cohabitation agreement in place?

A cohabitation agreement does not hold any influence over the intestacy rules which take effect when a person dies without making a will. If one of the partners involved in the cohabitation agreement passed away without leaving a will, the cohabiting partner would not be classed as next of kin and would be unlikely to inherit. Therefore, cohabiting couples should also make a will in line with their personal wishes.

Can a cohabitation agreement be changed at a later date?

Yes.  Within every relationship changes can happen, whether it is the birth of children, the purchase of a property / asset or other significant change in circumstances. Such changes can and should be incorporated into a cohabitation agreement.

How often should a cohabitation agreement be reviewed / updated?

It is advised that following any significant life events or every 3 – 4 years, a cohabitation agreement is reviewed and updated as deemed necessary. It is only by updating this in line with your circumstances that the agreement will remain fit for purpose.

My partner and I are getting married / entering a civil partnership, what happens to the cohabitation agreement?

A cohabitation agreement is only effective until a marriage or civil partnership is entered into. Therefore, if a couple set out a cohabitation agreement when initially purchasing a property and then later got married, this would only remain effective until the date of marriage. If you still wish to regulate matters, consider having a pre-nuptial agreement.

A family member has provided some of the money to allow us to buy a property, can this be secured with a cohabitation agreement?

Yes, Prior to the finance being provided, the financial assistance being provided should be legally documented, outlining whether this is a loan or gift, repayment terms where applicable and any specific terms and conditions.

Clauses can be included within the cohabitation agreement that specify that in the event of a breakdown of the relationship, the finance provided is returned to them from the proceeds of sale, prior to these being distributed between the couple.

If you would like to speak to a member of the Price Slater Gawne Family Law team regarding putting place a cohabitation agreement or updating an existing agreement, please contact Kara Webster or Nicholas Clough on 0161 6155554, by email to Kara.Webster@psg-law.co.uk or Nicholas.Clough@psg-law.co.uk or via our livechat tab.