ARTICLE: OUR HOUSE AND THE MADNESS THAT ENSUES WHEN COUPLES FALL OUT
The UK Courts have an extensive range of powers to divide up the assets on a breakdown of a marriage. They can take into account all sorts of factors when doing so, such as the length of the relationship, the couples’ respective incomes and earning capacities, the savings and pension funds they have, and most vitally, their respective needs. In contrast, the law for unmarried couples when they separate is a minefield. Divorce legislation does not apply; there is no ability to award maintenance (save in respect of children) or the sharing of pensions, and the Courts have no option but to turn to antiquated and ill-fitting principles of Trust Law to deal with the shared home when couples separate. Meanwhile people are unaware of this lurking problem, understandably hoodwinked by the media generated myth of the ‘common law partner’.
The UK government continues to hold the sanctity of marriage on an untouchable pedestal (one only needs to look at the maelstrom over gay marriage to see this approach in action!) and has entirely shied away from legislating on the thorny issue of the rights of unmarried couples, or ‘cohabitees’. It is only inevitable that as the number of marriages dwindles, the number of cohabitees is on the rise. Judges are doing what they can to plug the seeping holes left wide open by a lack of legislation. However, whilst their efforts are admirable the effect has left many family lawyers concerned about the lack of clarity and certainty for separating co-habitees and it is extremely difficult to provide definitive advice to our clients.
So, how does the court deal with the ownership of a property when couples separate? The starting point is how the ownership of the property has been registered at the Land Registry. If the property has been registered in joint names then there is a presumption that the couple will own it equally. Likewise, if the property was registered in just one person’s name, then it will be presumed that person is the sole owner.
However the Courts can look at the entire dealings throughout the couples’ relationship to establish what their intentions were at the time they purchased and whether those intentions have or have not subsequently changed. This could include literally the conversations had between the couple at the point of purchase and subsequently about their home and seemingly innocuous comments constantly referring to the same as ‘our property’ can have serious ramifications. Most troublingly those intentions do not need to have been consciously formed by the couple, but the court can construe them from their actions. Throw into the mix further complications for the Court to factor in such as where one person has contributed more to the purchase price than the other; one person paid towards the mortgage each month while the other paid for the utilities; one person paid for a lavish extension; and you could be facing mucky, protracted and expensive litigation.
So, how can couples be sure of what they would be entitled to in the event that they separate? In order to protect themselves couples need to make sure that they enter into a written Deed of Trust or preferably a comprehensive Cohabitation Agreement at the outset to record their intentions at the time of purchase. The Agreement would also need to take into account the circumstances which the couple agree may change the way in which the property is owned at some stage in the future.