John Bolch on the Law Commission’s proposals for cohabitants’ rights

children's homes

Further to my post here on Tuesday, I have been giving a little more thought to the Law Commission’s proposals for reform of the law regarding cohabitants’ rights. OK, I know that the proposals are now nearly seven years old and that the present government has no intention of implementing them, but I still thought it might be worth giving them some fresh consideration and setting out my views. After all, if you indicate that you agree with a broad proposal for reform you really need to consider how that reform might actually look in practice.

Please note that what follows are only my own thoughts upon the Law Commission’s proposals. They are not based upon anything discussed in the Law Commission’s report, or elsewhere.

As I stated on Tuesday, the scheme proposed by the Law Commission had three key features. I will deal with each in turn.

The first feature was that anyone using the scheme should meet certain eligibility requirements. These were either that the couple had had a child together or that they had lived together for a certain length of time – a period of between two and five years was suggested.

To be honest, I’m not sure that these are required. As will be seen in a moment, the essence of the problem of cohabitants’ rights is that one party can suffer severe financial hardship as a result of the cohabitation. That is the problem that any scheme should be seeking to address. If an applicant can show that they have suffered such hardship, then that is the only eligibility criterion they need to meet.

What if there are children – won’t they need some provision? Well, that is what Schedule 1 of the Children Act 1989 is there for. Under that schedule one parent can already apply for financial provision for the children against the other parent including, in particular, provision for their housing.

As to any qualifying period of living together, I could see that causing difficulties with relationships as the ‘deadline’ approaches. It could also lead to unnecessary arguments as to exactly when the cohabitation began and ended – the whole nature of cohabitation is that it is ‘free’, not subject to artificial rules regarding its beginning and end. In any event, as I indicated above, a qualifying period is just not needed – all that is needed is proof of hardship. Having said that, it is probably the case that any such hardship is only likely to materialise after several years of cohabitation.

The second feature of the Law Commission’s scheme was the possibility that the parties could ‘opt out’ of it. This might satisfy some of those who do not believe that cohabitants should have any rights, and I accept that it should be a possibility, just as it is a possibility that married couples ‘opt out’ of the rules on financial relief after divorce, by entering into a pre-nuptial agreement.

Two things should be noted about the ‘opt out’, however: firstly, there must of course be no duress on the part of the financially stronger party, forcing the weaker party to agree to the ‘opt out’. Secondly, this is a positive step that must be taken – like pre-nuptial agreements, the party who is being asked by the other to agree is ‘put on notice’ of the other party’s feelings regarding money and property. Perhaps the party who is being asked may reconsider the whole relationship?

The final feature of the Law Commission’s scheme is that the party applying for financial relief would have to have made ‘qualifying contributions’ to the relationship, which give rise to the respondent retaining a benefit, or the applicant suffering a continuing economic disadvantage. As I indicated earlier, this is the crux of the problem. The classic situation is where the contributions take the form of one party, usually the woman, giving up work to look after the home and the children. If she does this for an extended period then the other party has gained and she has lost. In such a situation the court should be able to redress the balance.

Note, however, that this does not mean that she will be entitled to the same sort of settlement that a wife might expect after a long marriage. There will be no ‘starting-point’ of equal division of assets – she will only be receiving some compensation for her loss, which will hopefully help her to re-establish her economic independence.

Well, those are my thoughts. If (as I hope) this reform is going to be back on the agenda then there needs to be some discussion, and this is my small contribution.

John Bolch

John Bolch often wonders how he ever became a family lawyer. He no longer practises, but has instead earned a reputation as one of the UK's best-known family law bloggers.

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4 comments

Louise Tomlinson - May 10, 2014 at 10:14pm

I quite agree with the points made in regard to the unfairness of separation for cohabitees. As a single mother of four children who was in an 11 year relationship to my ex partner, it is very apparent just how unfair the system currently is. My ex partner is Australian and the older two children are Australian born the younger two UK born. As we separated here in the UK (rather than in Australia where De facto relationships are recognised the same as married couples) since going through financial act proceedings it is apparent that I have no financial security for my future once all my children reach the age of 18. I sacrificed my career progression to raise children for those 11 years and apart from child maintenance until each respective child reaches the age if 18 I have a hugely reduced capacity to work due to my commitments to raising the family. I will be literally homeless once the last child reaches 18 (12 years from now at the age of 52) with no capital assets and no pensions or savings (as my ex controlled all the financial side) whilst my multi million pound ex sits on his capital assets. I’m currently studying to retrain to allow me to get back into the workplace at some point in the future but obviously am restricted with no family nearby to help with childcare costs. Clearly the cohabitee situation in separation needs to be addressed to create a level of fairness to those in similar situations to mine.

I will be interested to see what eventuates.

Kind regards

Louise

Russell Armstrong - May 11, 2014 at 12:28pm

I have an idea.
If someone wants a committed relationship within a legal framework then there is always a thing called marriage!!!!!
If you co-habit you take what is given, don’t try and call for “rights” to be given to co-habitees when they have clearly chosen to remain un-married
Don’t use the excuse that “he/she doesn’t want to marry but I still want rights” stuff that leave the relationship.
I think its called letting people choose their own path and if that means outside of the “systems” influence then so be it, we are all adults

annoymous - May 11, 2014 at 1:13pm

Hi Louise

What was your carreer before having children, ? What qualifications did you have

Seems to me that a lot of women use the excuse ” i gave up my career for the children” , when in fact their earning potential would of always been poor regardless of having children.

For example

27 year old women wants to have a child, she is working in mcdonalds frying burgers. She has no qualifications

She meets a sucessful buinsess man , and marries him and has a child
15 years later after the man pays all the bill etc the wfie wants a divorce

Wife decides that if she hadnt given up her job in mcdonalds and had a child , she would of gone on to be chief excutive of mcdonalds uk on a salary of 500k per annum so she needs to be compensated.

Luke - May 13, 2014 at 9:56pm

The system isn’t unfair to cohabitees at all, even though I think men generally get the financial shaft in marriage they at least consent to some sort of CONTRACT – they may be idiots for signing it and effectively handing over most of their assets by doing so but any man in 2014 (earlier husbands have a much better excuse) cannot complain without admitting basically wilful ignorance of what might befall them. I should caveat all this by saying that richer women can lose out very unfairly too, although when there are children that is not going to happen very often.
.
People are slowly waking up to this, it is one of the major reasons why marriage has become so deeply unpopular, and the lack of marriages causes a problem, because under current law asset stripping of the richer partner becomes much much more difficult.
The net effect is a financial problem for the government and for this reason – and the fact that fewer marriages will lead to fewer divorces and so inevitably less legal work – the idea of cohabitation laws are now being pushed vigorously.
.
As John states the minimum suggested cohabitation period suggested has been 2-5 years, but there is a concern as he suggests that the richer partner may opt out just before they are trapped and so John suggests ‘fudging’ the timeframe – he reasons that if you don’t know what the timeframe is you cannot opt out !

The idea of being trapped financially despite signing no contract and not even knowing what the timeframe of being liable is I regard as an absolute disgrace but then I have learnt over time that nothing seems to be beyond consideration on these matters.

I think there is a high chance that some form of cohabitation law will be brought in by the next Labour government – and the long-term effect (of course it WILL trap a lot of people in the short term) will be to force men and women in to single occupier homes – a trend which is already well on its way already…

Note: None of this of course has any effect on child maintenance. It is taking assets from the partner that owns them and one partner paying the other partner a monthly cheque for long periods after the split that is at stake here.

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