If you are buying a house with your partner, it is important when you purchase the house to decide what should happen to the property if you were to separate. This a vital issue to avoid any dispute in years to come and so have to meet legal fees to argue the point in court.

Many couples live together before they get married, or choose not to get married at all. However, unmarried couples living together have different legal rights compared to married couples. Unmarried couples don’t have the same legal protection as married couples; and they also have less responsibility to each other in the event of a breakup.

The only way to get the legal rights of a married couple is to get married. This remains the case even if you live together for many years,  have children together or buy a house together.

It is also the case that Unmarried cohabiting couples have no automatic right of inheritance if their partner dies without a Will.  When someone dies without a Will, there are legal rules (called ‘intestacy rules’) which decides who benefits from their estate. Unmarried partners do not benefit under intestacy rules.

My partner and I are splitting up – What happens to the house?

Unmarried couples living together (cohabiting) have different rights to those within a marriage or in a civil partnership.

If a marriage ends in divorce, the court will mainly consider the needs of each individual, rather than who owns what share of the house. For example, it often happens that if a wife has care of the children she will be awarded the family home, as her needs will be deemed greater.

This principle does not apply to cohabiting couples. In law there is no such thing as a ‘common law marriage’.  

Unless there is a cohabitation agreement or a Deed of Trust, unmarried couples have little rights.

If someone moves their partner into their house and they subsequently split, that partner would normally have no claim upon the property, although it may be possible for the partner to argue that they have contributed towards the property finances or maybe paid for a new kitchen or a new roof and and so should have a share.

If one partner owns a house, the other partner may have a claim to have an interest in it on the basis that a “trust” has arisen, even if the relationship later breaks down. A trust may arise where a partner makes certain financial contributions (for example by paying to build an extension). 

In this situation, a trust of this nature is when two (or more) cohabitees have an implied agreement relating to a property, normally based on their behaviour and financial contributions. The trust means that the homeowner isn’t placed in a better position at their partner’s expense. Both partners may be beneficiaries in a trust – even when nothing has been written down, and the other partner is not on the title deeds of the property.

These trusts can be formed between cohabiting partners, and are a complex area of the law. In the event of a dispute (for example, if the relationship breaks down) the Courts often become involved. The Court may need to decide the extent of the contributing partner’s beneficial interest. By nature, these trusts are uncertain and seeking legal advice at an early stage is advisable.  This would include instructing a legal advisor to prepare a declaration of trust so that the terms of any trust are agreed in advance, which removes the uncertainty going forwards.

What happens if an unmarried couple jointly own a property?

Unfortunately the legal position is not clear cut. Ordinarily, if a couple own equal shares of a property, they will be entitled to an equal share of the value if it is sold.

However the court case of Jones v Kernott has highlighted that this can be overruled if the common intention of the parties has changed.

In this case the house was owned 50:50 according to the title deeds, when Mr Kernott moved out in 1993, leaving Ms Jones to pay the mortgage. As they did not then share the expenses of the property, the court said this meant that it was not “the common intention of the parties to hold the property jointly”.  Put simply, Mr Kernott had made less of a contribution. Instead he was then directing his finances towards his new home. The Supreme Court therefore ruled that his intention to jointly own their home had changed, meaning he had less of a claim over the property than the 50% in the title deeds. In this case Ms Jones was awarded 90% of the property, leaving Mr Kernott with only 10%.

Avoiding disputes

What this case shows is that when it comes to dividing the homes of unmarried couples, there can be uncertainty. To help avoid this, it is wise to set out what will happen to your property if you split up.

Cohabitation agreements for unmarried couples living together

A cohabitation agreement is a legal document designed to protect the legal rights of unmarried couples. It makes things straightforward if you ever separate. We can create a cohabitation agreement for you that clearly sets out what would happen if you ever separated. It gives you legal protection and helps make sure there are no misunderstandings. For example, if you own property together a declaration of trust will clearly set out your ownership rights.

If you have been cohabiting and the relationship has come to an end, we can advise on the best way forward. For example, we can help you divide any assets you have together. It’s not always straightforward when a relationship breaks down, but we’ll help you keep the practical aspects under control.

Property laws in particular are complex and often turn on specific facts. If you have a property dispute but no declaration of trust, our expert and in-depth knowledge will help you to make the decisions that will resolve any sale or ownership issues. We also have a lot of experience in helping couples who have children

You should really seek legal advice on this in advance of purchasing a property together.

Call us on 0191.4862799 or email jbrown@nechambers.co.uk