Legal Basics - Property

Unmarried Couples - Living Together

More and more couples now live together without getting married, but no matter how long the relationship the law still effectively treats them as separate individuals with no rights or liabilities to each other if the relationship ends.

This has some far reaching consequences for such couples (of whatever sex or combination of sexes), particularly in relation to their home (most people's biggest asset), and what should happen if either party were to leave or die. The majority of couples fail to consider these points until after their relationship has ended.

Unlike married couples, unmarried couples have no basic rights to their partner's property or to maintenance if they split up. Basically what is his is his, what is hers is hers, and what is jointly-owned needs to be divided. 

This applies to the home as well. Therefore if a house is bought in joint names (either as beneficial joint tenants, or as tenants-in-common - click here for more info on these terms) then it should be split accordingly on separation, and either party can force a sale of the property to realise their share. If  the parties are contributing unequally to the purchase price, or to the maintenance of the property, then this should be reflected by being designated as tenants-in-common and holding unequal shareholdings (say 70% and 30%), rather than the equal shareholdings of beneficial joint tenants. 

If the property is in the sole name of one party then ostensibly it remains that person's property on separation, unless the other party can establish that there was a common intention that they would be entitled to a share in the property. How do they do this? Well this may have been agreed in a simple conversation, or in writing between the parties at some time (proving it tends to be the problem!); if the other party directly contributed to the purchase price the courts are likely to accept that at least part of the property should have been in their name; and finally if there has been an understanding between the parties and the non-owner has acted to their detriment as a result (eg contributed to mortgage repayments, paid household bills, or, perhaps, sold their own property) then the courts may agree they should share in the property. The parties can, of course, come to an agreed settlement, but if not, such disputes can become messy and expensive. It may not sound too romantic, but it is quite legitimate for unmarried couples to enter into an agreement when they start living together to try and cover any disputes on property if they should split up. Its worth considering. You could buy a basic pack here (just click to go there). 

The other essential matter for unmarried couples to consider is that as they are not related, unless they make a Will in favour of their other half, then, should they die, their estate will pass to their immediate family under the intestacy rules, rather than their partner (except their share in the home if they are beneficial joint tenants). If the relationship is a serious one, then they should both make Wills at an early stage.

Here's some possible further reading

Cohabitation Rights - Philippa Pearson
As more couples choose not to marry, the legal and financial issues they face with children, mortgages, pensions, separation and death become ever more important to understand and address. This text discusses the options in cohabitation agreements and mediation, and provides advice for couples.
CLICK for INFO

Co-Ownership - Joint tenants or tenants-in-common?

If you buy a house jointly with someone else (your spouse, lover, a relative or friend) then it is important to decide  whether you will own the property as joint tenants, or tenants-in-common. So what's the difference.

If you are joint tenants then each of you jointly own the entire property (technically its held by you in trust for yourselves!). The consequence of this is that upon the death of one party their interest in the property passes automatically to the survivor. It is therefore usual for married couples to buy a property as joint tenants.

If you decide to hold the property as tenants-in-common, then each owner has a distinct share in the property. If there are two owners this will automatically be half each, if three a third each, and so on. Alternatively you can decide between yourselves what share of the property belongs to each owner. For example if 2 friends were buying a property together and one contributed more to the purchase price than the other, this could be reflected in the respective shares of the property, say 75% and 25%. The important point is that each of the tenants in common always owns their share of the property, and are only entitled to that percentage of the sale proceeds, if sold during their lifetime. If they die then their share of the property forms part of their estate. It does not automatically pass to the other owner(s).

So if you are buying take a bit of time to think through your own situation and make sure you discuss it with your solicitor.

If you own your property as joint tenants and your relationship breaks down, one of the first things that you should do is to sever that joint tenancy. This converts the joint tenancy into a tenancy in common, which means that you will have a distinct share in the property that will NOT automatically pass to your former partner/spouse.

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