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More people are choosing to live together and not marry and start living together without considering taking legal advice as to the implications this could have on them before doing so. Many people don’t think about the legal side of moving in together and what this means if you then at a later date, split up.
Many people wrongly think that a Common Law Wife is a legal term, it is not. In the event of separation non-married couples have no obligation towards the other. The only claims separating couples who have not married can pursue are under the Child Maintenance Service or Property Law as relevant to their circumstances.
Once separated, if the property is in the sole name of one party, it remains that person's property unless the other party can establish that there was an intention that they would be entitled to a share in the property. Proving this can cause much stress and be an expensive process.
In order to provide certainty for your future we advise that any persons looking to live together enter into a Cohabitation Agreement that will set out firm boundaries as to what each party’s entitlement to the house will be. This can be for property to be owned jointly or by one person.
In the event of a relationship breakdown we can draw up a Separation Agreement which will stipulate what terms have been agreed between the parties and what claim if any each party has on the Cohabitational Home.
Legal Ownership of Property
The Title Deeds will state who owns a property and if it is more than one person how the property is held between the owners. This can be as Joint Tenants or Tenants in Common. As Joint Tenants you own the house equally and if one owner were to die, their share would pass to other automatically on death, regardless of any Will. As Tenants in Common you can own the house equally or in other stated shares and you can leave your share to a nominated third party under a Will.
Disputes Between Co-Owners
When a relationship breaks down, one person may wish to sell the house whilst the other not. The Trusts of Land and Appointment of Trustees Act 1996 (known as TLATA or TOLATA) sets out the circumstances when the Court can force an Order for sale.
One owner may wish to argue that they own more than their legal share. An owner may be entitled under “equitable accounting” for compensation for money they have spent even where shares are fixed. Equitable Accounting also applied to occupation rent where a person has been excluded from living in a property they own. This is a very complex area of law and specific legal advice should be sought from one of our experts before you attempt a claim.
Ideally, the parties would have entered into a Cohabitation Agreement which would cover matters such as this to avoid the need for a dispute on separation. However, if they have not, most disputes can be resolved, and the agreement recorded in a Separation Agreement.
Claims Against a Property by a Non-Owner Cohabitee
A person who is not the legal owner of a property can also make a claim against its Ownership under the Trusts of Land and Appointment of Trustees Act 1996 (known as TLATA or TOLATA). This can either be for financial claims or for rights of occupation.
Under that Act, when deciding what order to make, the Court will look at the following:
- the intention of the parties when the property was purchased and afterwards
- the purposes of the property i.e. is it a family home?
- the welfare of any children who live in the property
- the interests of any secured creditor of any beneficiary i.e. mortgage lender
Rights to Live in a House
If you are joint owners, you both have a right to occupy the house.
Only if a person obtains an Occupation Order can they exclude the other from entering and living at the property. Occupation Orders protect your right to live safely in your home. They can prohibit a joint owner from living in a property if you previously intended that house to be your shared family home. Non-owners can also apply for an Occupation Order if you previously intended that house to be your shared family home. An Occupation Order will usually have a Power of Arrest attached to it, meaning that the police can arrest the person if they return to the property.
Legal Aid remains available for Occupation Order matters and there is no longer any Court fee charged for such applications.
It is most likely that a joint mortgage is joint and several. This means that you are both responsible for the full repayments of the mortgage each month and in the event either of you refuses to pay your share if full payment is made by one person both will suffer adverse credit ratings.
Order for Sale
Under the Trusts of Land and Appointment of Trustees Act 1996 the Court can order that a property be sold and the proceeds be divided accordingly even following an application by a person who is not the legal owner of the property.
Are Separation Agreements binding on divorce?
Strictly speaking; no. The Courts have the power to make any Orders they see fit on a divorce if it is just and fair to do so. However, provided a Separation Agreement has been drafted well and certain criteria met, the document is very likely to persuade a Judge to only make an Order in the terms set out in the agreement.
It is for this reason that it is absolutely crucial to take expert legal advice about Separation Agreements if you wish to secure more certainty around your financial situation.
Are Separation Agreements binding on non-married couples?
Strictly speaking; no. The Courts powers for separating couples who are not married are much narrower than the powers of the family Court. Usually, the Courts involvement is confined to any jointly owned land and property. However, in those circumstances, a Separation Agreement can be persuasive in proving to the Court the parties intentions and therefore we do still recommend clients consider entering into such agreements where jointly owning property.
If you would like to discuss this further please do not hesitate to speak to one of our friendly team members on 01785 252377 for Stafford appointments, 01782 987551 for Newcastle-under-Lyme, 01782 813315 Stoke-on-Trent or 01270 446260 for Alsager appointments.