Case Studies

Home owned by one partner only

An unmarried couple aged 52 and 43. The family home was in man’s sole name as he already owned it at the time the parties met. They agreed the mother would give up work and stay home to care for the three children. After being together 23 years, they decided to part ways. The home and savings were all in the man’s name as he was the sole wage earner. The man also had a good pension.

The mother, despite giving up her career, was entitled to nothing as she had not contributed towards the purchase price of the home nor the mortgage secured on it. She was not entitled to any maintenance for herself or for her children as they were all over the age of 18. She was not entitled to any of his savings or a share of his pension.

Had she received an inheritance during the marriage and applied the monies to the improvement of the home then she may have been able to bring a claim in respect of this financial contribution to the home, but she would have had to rely on complex property law principles. Legal action of this nature is complex, lengthy and extremely expensive and the prospect of success limited.

Could it have been different?

Whilst she would never have been entitled to his pension had she had a Cohabitation/Living Together Agreement she may have been entitled to a share of the home, savings, cash and maintenance for herself as they could have agreed on this when they made the joint decision that she would give up her career and stay home to raise their children.

Home bought in joint names

An unmarried couple buys a house together in joint names. The man paid the deposit of £70,000 funded by the remortgage of the flat he owned when the couple met. They shared equally the mortgage repayments. The man paid for materials and undertook some extensive home improvements to the property over the first 18 months. He also paid for professionals to carry out some structural improvements. After being together for almost four years, the couple decided to part ways. There were no children.

As the property was in joint names and there was no Declaration or Deed of Trust or any Cohabitation or Living Together Agreement, the couple were each entitled to 50% of the equity in the property. In other words, on purchase of the property the man had in effect gifted £35,000 to his girlfriend simply because he had not taken steps to legally protect his contribution. To make matters worse the woman wanted to stay in the house and refused to agree to a sale of the property. The man wanted a sale as he wanted to be released from the mortgage. As the couple could not agree, it was necessary for the man to bring a court action for an order for sale of the property. Whilst he was successful it was a lengthy and expensive process.

A Cohabitating or Living Together Agreement would have protected the man’s deposit monies and his time and money carrying out the extensive home improvement. It would also have set out what would happen to the property if the couple decided to part ways, such as whether the property would be sold or whether either party would have the opportunity to buy the other out and it would have set timescales etc. for both.

A Cohabitation Agreement can be drafted either in advance of living together or whilst the partners are living together and can cover:

Who owned what at the outset

How any jointly acquired property will be divided up in the event of the relationship’s breakdown

How the mortgage and household outgoings will be paid during the relationships

How new injections of cash may alter the shares the partners own the property

What would happen should the relationship end in terms of mortgage payments, bills, debts, and any other expenses

How the practical mechanics of the physical separation will work

How the partners would realise their capital worth

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