Marilyn Stowe Blog

Cohabitation v remarriage: what's a breadwinner to do?

Proposed legal rights for cohabitants have one reader reaching for the panic button.

As regular readers are aware, I hold strong views about the Government’s reluctance to introduce new legislation for cohabiting couples. I believe that cohabitants should be allowed to put their relationship before the court in the same way that divorcing couples can.

Not everyone agrees with me. One reader has contacted me to argue that the law should not be changed. I think he raises some interesting and pertinent points about cohabitation and remarriage, and I would like to explore his case in more detail.

He is a successful businessman, with an annual income of £350,000. He was married for 20 years, but was recently divorced. He has provided capital for his former wife’s rehousing; as there was insufficient money for a “clean break”, he must make continuing maintenance payments. In addition, his former wife receives half of his annual pension. He calculates that in total, she receives £24,000 of his annual income.

As his former wife has needs that must be met, I don’t take issue with the fairness of the overall award. This was a lengthy marriage and although he was the breadwinner, the court regards the couple’s financial assets and resources as available for distribution between both parties. In truth, with his annual payments to his former wife amounting to less than 10 per cent of his annual income, he has fared far better than many others in similar circumstances.

However he has – understandably – been bruised by the experience. He has found love again and is living with his new partner, but he is determined not to remarry. He intends to protect his finances – and does not wish to risk the possibility of another divorce.

His fears are well-founded. Even if a prenuptial agreement was drawn up, there is no certainty that it would be binding. This man is caught in the classic trap of the “mid-range wealthy”, who don’t get tax breaks on divorce, don’t qualify for legal aid and in percentage terms, are the biggest financial losers. He has too much money not to be adversely affected by a divorce – and too little money for it not to matter.

Sadly, the success rate for a second marriage is even less than for the first. Often, this is because of hamstrung relationships between new spouses and children from the first marriage. If this reader married and divorced again, his second wife would not be entitled to half of the couple’s assets. Her lack of contribution to those assets would be taken into account. Even so, she would be entitled to have her needs met.

Such a case demonstrates the need for a debate about the legal status of prenuptial agreements. Clearly, an enforceable prenup is what this man needs.

In the meantime, proposals to give new legal rights to cohabitants have him reaching for the panic button.

He writes:

I will not again surrender the income and assets I have worked so hard for, all my professional life, to the whimsical decision-making of the courts. I am the one who has spent most of my youth studying and also my adult life to gain the income and status I have. I am happy to share that with [my new partner] but will not be forced into giving half of it away again – plus pension and income. My other option: to trawl society for an individual with similar income and assets. How ridiculous is that? Why can we not be left in peace to enjoy our lives?

I can understand his concerns, but I do not believe that they represent legitimate arguments against legislation for cohabitation. This is because in my opinion, the scope and extent of the proposed reforms have been widely misunderstood.

The proposed legislation would not share the wealth of a cohabiting partner on similar terms to a divorce. Instead, it advocates a form of compensation when there have been “qualifying contributions”, which give rise to “enduring consequences”, as a result of the relationship’s breakdown. This is when one of the parties has retained a benefit or suffered a continuing economic disadvantage, as a result of their contributions made to the relationship.

For example, if a couple is cohabiting and one of the parties gives up a job in order to stay at home and care for the couple’s young children, that carer loses out economically. The proposed legislation would mean that if this couple’s relationship ended, the carer would be entitled to make a claim against the other party, who would have prospered economically by being able to work free from child care responsibilities.

Our businessman need not be concerned about the Law Commission’s proposals, because his cohabiting partner could not make such a claim. He states that her income is modest; however, she has made no qualifying contributions to their relationship and has suffered no economic disadvantage as a result of that relationship. Moreover, the proposed legislation would permit couples to “opt out” if they had entered into a cohabitation agreement.

The proposed legal redress would not be divorce settlement under a different name. I believe the press has misinterpreted its extent and effect.

There is one final, if morbid point that I would like to make about this reader’s case. Were he to die before his former wife and present partner, both women would be entitled to make a substantial claim against his assets, under the Inheritance (Provision for Family and Dependants) Act 1975. If he has not done so already, he needs to make a will that provides properly for them both. Otherwise, his estate could be attacked and a great deal of it eaten up by…….legal costs.

Related posts:

1. Maintenance, remarriage and “Barder” events
2. Cohabitation and the “common law marriage” myth
3. Cohabitation and our cowardly lawmakers
4. Unmarried parents, children and chequebooks