Recent figures published by the Office for National Statistics show an ever-increasing trend towards couples deciding to live together (cohabit) prior to getting engaged. According to the ONS, over 9 out of 10 marriages in 2021 and 2022 took place where the couple was living together beforehand.

Of course, some people prefer never to get married at all and in some cases, couples may decide that long-term cohabitation without any commitment to marriage is the best course for their relationship. In the shifting social landscape of the country, it is becoming more common for couples to live together outside of marriage, without that choice devaluing their commitment to one another in any way.

Although cohabitees do not have the same rights and responsibilities in law that automatically apply to married couples, the best way for cohabitees to set out their financial rights and responsibilities is by way of a cohabitation agreement. It is important for cohabitees to remember that sharing of the finances upon separation is not an automatic right for unmarried couples, except where any property is legally owned between partners. In that scenario, any division of property will automatically fall in line with the simple principle of legal ownership over that property. But sometimes, ownership over property can be complex, as whilst a person may not have a legal interest, they may have a beneficial interest.

For example, it is common to have a scenario where a house is owned legally in the sole name of one partner, but the other partner who does not have any legal title over the property makes financial contributions to the same, either by way of improving the home in some way or by making payments for bills or the mortgage. How could the couple therefore ensure that they protect their right to ownership over the property, or ensure that their contributions are fairly reflected post-separation?

As a whistlestop tour, a cohabitation agreement can set out each partner’s rights to personal property when entering in to cohabitation with their partner. This is done with the express purpose of providing clarity in a scenario such as the above, in order to prevent litigation arising from any disputes where there is uncertainty as the intention of the couple in relation to ownership, or what is ‘fair’.

The ONS says that for opposite-sex couples, cohabitation before marriage occurred in 90.3% of all marriages in 2021 and 90.0% in 2022. For same-sex couples, this was even higher, at 95.2% for men and 93.5% for women in 2022. There is therefore, a substantial proportion of couples in the UK who could benefit from a cohabitation agreement.

In certain circumstances, some provisions of the cohabitation agreement may also be considered upon divorce (if parties marry after cohabiting and particularly if the cohabitation is converted into a Pre-Nuptial Agreement), and this could be done when the Court looks at what is fair when dividing assets. However, this should be viewed with the utmost caution, as there is no guarantee and when there is a clear need for one party to receive a larger share of the assets to meet their needs under UK divorce law, the Court can ignore the terms of such agreements.

Partners should therefore always consult a solicitor as to their rights and obligations when forming a cohabitation agreement. This is especially important where there may be an imbalance between partners as to their financial positions when entering into a cohabitation agreement or when one partner may be vulnerable.

Our solicitors have a vast array of knowledge and experience dealing with the formation of cohabitation agreements. If you are curious about entering into a cohabitation agreement with your partner, you can book in an initial consultation to find out how the same can provide you with financial certainty for the future in your relationship.

T: 029 2034 2233

Author: Owen Day

Published: 11.07.24