The Cohabitation Rights Bill aims to fill a gap in the law giving couples rights that, until recently, were only associated with marriage.
Many long term cohabiting couples have moved in together under the misconception that if their relationship were to break down, they would receive similar treatment to that of married couples, when in reality their legal status is completely different.
The Cohabitation Rights Bill was put forward by Liberal Democrat, Lord Marks last year, and has recently passed the second reading in the House of Lords.
The Bill aims to provide rights, responsibilities and basic protection for cohabitants to cover an ever-increasing gap in the law.
Figures from the Office for National Statistics revealed a 98% increase in the number of cohabiting couples from 1.4 million in 1996, to 2.9 million in 2012.[i]
Rights for these couples are limited under current legislation making it even more difficult to divide assets upon separation. Couples often depend on property and trust laws if the relationship breaks down resulting in lengthy, expensive proceedings.
The proposed bill will give cohabiting couples, with or without children, the right to apply for a Financial Settlement Order if they have lived together for more than two years.
The individual must show that a qualifying contribution has profited their partner unfairly or left them at an economic disadvantage in order to be compensated for their shortfalls.
Legislators have decided that cohabiting couples should automatically be opted in to the terms of the proposed bill. If they wish to avoid the extra responsibility and paperwork, couples can opt-out by entering into one of three agreements:
- Opt-out agreement – both partners must receive legal advice and understand the repercussions of the agreement fully.
- Cohabitation agreement – a method which records the couples’ intentions about organising finances and assets before and after they separate.
- Deed of trust – to show who has a legal or beneficial interest in any specified assets or property should the couple part.
The court has the right to withdraw a cohabitation agreement or deed of trust if they feel it is appropriate, making an opt-out agreement the most reliable option.
The framework comes amid campaigns from the family law organisation, Resolution, who believes that current family laws are outdated and unfair.
Steve Kirwan from the national organisation says, “Ultimately, the law needs to reflect the standards of modern society, and in the case of cohabitation, it does not.
“The current law on cohabitation is in desperate need of change and we believe that even Lord Marks’ bill, whilst welcome, does not go far enough to address the inequality in the current system.”
Despite being a significant advancement in this area of family law, it is worth noting that The Cohabitation Rights Bill is currently at the Committee Stage and is not yet law in England and Wales.
Charlotte Talbot is a Family Solicitor at Beecham Peacock LLP who are specialists in Family Law. Call 0191 232 3048 or email ctalbot@beechmapeacock.co.uk.
[i] [i] Office for National Statistics. 2012: Cohabitation in the UK. Available at: http://www.ons.gov.uk/ ons/dcp171776_284888.pdf
