Family seated on a couch

At Bross Bennett, we believe in empowering individuals with knowledge to make informed decisions about their relationships. Partners Eleanor Hoare and Jamie Gaw recently addressed the nuances of cohabitation versus marriage, demystifying common myths surrounding legal rights and financial protections. Find out what you missed in their recent talk.

Legal differences between cohabitation and marriage

The distinction in legal rights between cohabitees and married couples is stark. Despite a prevalent belief in a “cohabitation common law marriage,” couples living together before marriage are not afforded the same legal protections. This misconception can lead to significant financial vulnerability, particularly upon a relationship breakdown.

For instance, while married individuals have a starting point of equal division for property and assets, cohabitees could be left with no claim to their partner’s property or finances, including the family home, if not legally co-owned. If the property is not held in a cohabitee’s name, they have no right to remain in the property even if they have contributed to the mortgage or deposit or paid the bills. Spouses can claim for maintenance from their higher earning spouse if they are unable to meet their reasonable needs whereas cohabitees have no right to receive maintenance for themselves. Spouses are entitled to a share of each other’s pensions accrued during the marriage but cohabitees are not.

To illustrate these principles, imagine a sample case scenario with Barbie, a wealthy tech entrepreneur, and Ken, a personal trainer.  She has significant investments and savings and a large pension. She comes from a wealthy family and lives in a house worth £8.5 million. In addition, she is the beneficiary of a family trust and will likely receive at least £10 million of inheritance in the future. After cohabiting for a decade and Ken’s significant contributions to the home and Barbie’s business, their separation left Ken with no legal claim to Barbie’s assets, whether it be a share of her savings, pension or maintenance. He is left with nothing and has to leave the family home immediately.

Protecting a cohabitees’ rights

A cohabitation agreement is essential to protect your rights. This document sets clear expectations and protections for both parties, covering contributions to property, division upon separation, and living arrangements. Additionally, Declarations of Trust (a legal document confirming the terms in which joint owners of a property own a property and in what shares) and Wills are crucial tools for cohabiting couples to ensure their intentions are respected.

The role of pre-nuptial agreements

If Barbie and Ken were married, without a prenuptial agreement, Ken could claim up to half of Barbie’s assets. With a pre-nup, Ken’s entitlement on divorce would be limited to the terms of the agreement, providing certain safeguards were met. For example, the pre-nup could limit his housing needs to a fixed sum rather than 50% of Barbie’s house. A pre-nup could have offered Barbie a safeguard, ensuring her assets, like her trust fund and inheritance received during the marriage, remained protected.  

Whether cohabiting or marrying, understanding and planning for the legal implications of your partnership is crucial. Both cohabitation and pre-nuptial agreements serve as valuable tools to provide certainty and protect against potential disputes.

At Bross Bennett, we are committed to guiding our clients through these decisions with expertise and empathy.