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Jay Patel discusses financial claims on the breakdown of cohabiting relationships

  • September 01, 2020
  • By Jay Patel, Partner

Contrary to popular belief, there is no such thing as “common law marriage” in England and Wales. Nor do we have any laws providing for financial relief on the breakdown of a cohabiting relationship. This means that even if a couple have lived together for a long time, and even if they have children, they have no legal or financial obligations to each other if their relationship ends.

Where the couple own property, the court will be able to determine the ownership of that property. This often arises in respect of the family home but can also apply to other properties and assets. It might be that the property is jointly owned and there is a dispute as to the proportions in which it is held, or that it is owned in one person’s name and the other asserts an interest in it.

The starting point will be to establish the legal ownership position, if it is a property then this will usually be by reference to the Land Registry documents. This will often be determinative, but in some cases can be displaced through a “constructive trust” if the parties had a “common intention” that their interests in the property should differ from the legal position. The law on what is required to establish this is complex, and can require consideration of the parties’ entire “course of dealing” in respect of the property.

Alternatively, it may be possible to establish an interest in a property by way of “proprietary estoppel” where the owner of the property has assured the other that they have an interest in it, and the non-owning partner has relied on that to their detriment.

Where a cohabiting couple have children, then the parent with whom the children are living can make a claim for financial provision on the children’s behalf.

Capital provision can be sought under Schedule 1 of the Children Act 1989 (known as a “Schedule 1 claim”). This can include a home for the children to live in, as well as sums to meet other needs, such as a car to transport the children, or private school fees. Much will depend on the financial resources and lifestyle of the parents, and the needs of the children. In reality the parent the children are living with will benefit from the provision, particularly if it is for a home, but once the children have reached 18 or finished their education the property will need to be returned to the parent who funded it.

Child maintenance is generally calculated using a formula set by the Child Maintenance Services, but it is open to parents to agree a different amount, and variations to the formula apply in certain circumstances. Further, the formula ignores the non-resident parent’s income in excess of £156,000 gross per annum, and where their income is higher than this a “top-up” order can be applied for.

If a cohabiting couple is separating and there are disputes about the ownership of their property and about the financial provision to be made for their children, the court will generally hear both claims together so that all of the issues can be resolved in one set of proceedings.

If you would like advice on the financial consequences of the breakdown of a cohabiting relationship, please contact Jay Patel or any of the Family Team on 020 7412 0050.

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