Should I ask my Partner to Sign a Cohabitation Agreement?
When you are in a relationship, talk of family law agreements can seem a bit formal and even a bit unromantic. In this article our family law solicitors explain why you should ask your partner to sign a Cohabitation Agreement.
Online and London Family Law Solicitors and Cohabitation Lawyers
What is a Cohabitation Agreement?
A Cohabitation Agreement is a document drawn up between a couple who are either living together or plan to do so. A Cohabitation Agreement can set out:
- Who owns the house – this can be legal ownership and non-legal ownership. When your name is not on the title deeds to a property but you have an interest in it this is called a ‘beneficial interest’ in a property
- How the equity in the property will be shared if you split up
- Who can stay in the property until the family home is sold
- How the equity will be calculated if one party is going to stay at the home and take on the mortgage
- Who will pay the bills while you are living together
- How home improvements will be funded and how that affects the split of equity
- How any joint bank accounts or debt or loans will be dealt with
- Ownership of the car, household contents or other significant or sentimental items
- Ownership of pets and who they will stay with if you split up
- If you have children, any planned childcare arrangements or child support arrangements or agreements, such as an agreement on private education and payment of school fees
That is a long list but not every Cohabitation Agreement has to go into as much detail or cover every point. However, you do need a Cohabitation Agreement whether or not you:
- Jointly own a property as joint tenants
- Jointly own a property as tenants in common
- Own the property in your name
- Live in your partner’s property
- Rent the property
The only circumstances where you don’t need a Cohabitation Agreement are:
- You are engaged to marry and the wedding date is within the next 12 months – you need a Prenuptial Agreement
- You are already married – you need a Postnuptial Agreement
- You are married but separated – you need a Separation Agreement or Financial Court Order
- You are in a civil partnership – you need a Civil Partnership Agreement
Some people ask whether they need a Prenuptial Agreement because they have already signed a Cohabitation Agreement. They do as a Prenuptial Agreement is different to a Cohabitation Agreement. If you are in any doubt about the sort of family law agreement you need, contact our family law solicitors on 0203 959 9123.
Why you need to ask your partner to sign a Cohabitation Agreement if you own a property
It is often assumed that if you are the legal owner of a house your partner has no rights or claims over it. That is not always right. Your partner may be able to argue they have a beneficial interest in the property because of alleged promises and assurances made by you and through them acting to their detriment. For example, by leaving their own accommodation or contributing towards your mortgage or paying towards household improvements.
The simplest way to prove that your partner does not have a beneficial interest in your property is to get them to sign a Cohabitation Agreement that says a beneficial interest will only be recognised if it is recorded formally. For example, in a new Cohabitation Agreement or a deed of trust.
If you want your partner to contribute towards bills at the property or to house renovations or extensions then the Cohabitation Agreement can quantify how much equity you will each be entitled to if you separate. This can be expressed as a percentage to take into account your payment of the deposit, the equity in the property at the time your partner moved in, or the potential future rise or fall in property prices.
A Cohabitation Agreement can be in your partner’s best interests as well as your own because if you split up and you are the sole legal owner of a property, they could face a complex legal wrangle over the extent of their beneficial interest in your house. A Cohabitation Agreement avoids that as it records what your partner is entitled to, without an expensive court battle to prove it. The Cohabitation Agreement can be flexible to cover extra contributions made by your partner, such as using an inheritance to pay for a new bathroom or kitchen or to reduce or pay off the mortgage.
What happens if my partner won't sign a Cohabitation Agreement?
If your partner won't sign a Cohabitation Agreement then that is their personal choice. They can't be forced to sign the document. You do need to ask yourself why they are refusing to sign the agreement. Is it because:
- They don’t understand what a Cohabitation Agreement is and how it can help you both. Do they need independent legal advice on the benefits of a Cohabitation Agreement to them and what should go into it?
- You have said that they won't get anything from your house but you are expecting them to pay your bills. Without a fair and reasonable Cohabitation Agreement in place you both risk ending up in court over cohabitation and property claims if you separate
- Your partner does not believe that the agreement can be drawn up in a way that is fair to them. Getting legal advice on the flexible provisions that can go into a Cohabitation Agreement may help
- They know they don’t have any cohabitation or property claims and think that if you split up, they would be better off without a Cohabitation Agreement so they can say you promised them a share of the house and there is nothing in writing to prove it or not. In some cases, a property owner will give a former cohabitee money to sort out a ‘nuisance claim’ rather than risk the cost and time involved in fighting a spurious court claim
- They have been influenced by friends or family and think they have cohabitation law rights as a common law husband or wife. If so, that isn’t uncommon. It is a popular myth that if you cohabite you become a common law spouse; you don’t
- They think that once a Cohabitation Agreement is drawn up it can't be changed and that would be unfair on them. A Cohabitation Agreement can be reviewed and changed, just like your Will or life insurance
With independent family law legal advice most couples both see the benefits of a Cohabitation Agreement that records a fair arrangement that they are both happy with as the agreement reduces stress and minimises the risk of court proceedings if you do sadly separate.
Online and London Family Law Solicitors and Cohabitation Lawyers