Generate PDF

Lucy Greenwood, Partner at The International Family Law Group LLP (IFLG) sets out some of significant and commonly misunderstood differences in the financial legal rights of married and unmarried couples.

For these purposes, the term married couples includes couples in Civil Partnerships.

                                                                                    ----------

Whether you, your clients, or family members are already married, cohabiting or contemplating how to move forward with a relationship, it is sensible to know what might happen in the event of relationship break down and the legal consequences if you were to separate in England.

There is of course a lot more to know than we are able to set out here (each couple’s circumstances are unique). Consequently this short article serves only as a preliminary guide.

There remain many myths surrounding the rights of cohabitees in England. There is no such thing as “de facto marriage” or “common law marriage” for unmarried couples in England. This still comes as shocking news to many cohabiting couples.

It can also mean that those cohabitees living in a country where they have enjoyed legal rights akin to married couples could lose those rights and legal protections if they move to another (e.g. England). Conversely, moving from England to a country which has de facto marriage might grant a cohabitee greater legal rights than before (e.g., Australia recognizes “de facto marriage”).

The court’s jurisdiction in England only extends to England and Wales. Other parts of the UK, including Scotland and Ireland have different laws. If you or your partner have strong connections (by nationality or residence) to countries outside England and Wales then independent legal advice from a specialist family lawyer practicing in that part of the UK or the relevant country should be sought.

The following table lists some of the differences in rights between married and cohabiting couples:

 

 

Married Couples

Cohabitees

DISCLOSURE

All assets worldwide in which either spouse holds any benefit or interest as at the date of review (which can be after the date of separation) are required to be disclosed. Historic documents for those assets can also be ordered to be disclosed.

 

 

DISCLOSURE

In terms of capital, only joint assets or assets where a party asserts they hold a legal share of an asset will be applicable for disclosure purposes.

If there are children of the relationship capiral and income producing assets worldwide would also be disclosable.

 

DISTRIBUTION OF ASSETS

English law states that assets on divorce can be distributed unevenly if this is deemed necessary to meet the other spouse’s reasonable financial needs based on the standard of living enjoyed during the marriage and affordability.

Consequently, where the sharing of only marital assets is insufficient to meet the other spouse’s reasonable needs, it can sometimes result in a distribution of more than 50% of the marital assets in the weaker financial spouse’s favour – so effectively also sharing some of the non-marital assets (including pre-marital, post marital, inherited or gifted assets).

DISTRIBUTION OF ASSETS

There is no right for one cohabitee to challenge the legal ownership (unless an existing beneficial or legal interest is proven and declared by the court).

But there can also be further provision for children of the family (as above)

 

CHANGES TO THE LEGAL OWNERSHIP OF ASSETS

The Court can change the ownership of any asset e.g.: from joint to sole ownership of a spouse or from one spouse to another. This applies to assets worldwide.

CHANGES TO THE LEGAL OWNERSHIP OF ASSETS

Strict property/civil law applies to ownership of assets

The Court only has authority to declare a beneficial interest in an asset if one can be legally proven.

But there can also be further provision for children of the family (as above)

SPOUSAL MAINTENANCE

The Court can award spousal maintenance. It can be anything from a nominal order (to keep maintenance claims open) to very substantive awards which can be of fixed term (sometimes extendable) or ongoing for joint lives of the spouses. It can also be varied and is sometimes capitalized.

SPOUSAL MAINTENANCE

There is no legal right to provide any maintenance for a cohabitee

POSSIBLE ORDERS

The spouse can receive the following orders.

  • Property adjustment orders against any asset worldwide (although enforcement abroad can sometimes be problematic and cumbersome)
  • Spousal maintenance
  • Lump sums
  • Pension sharing orders
  • Child maintenance until child reaches 18 or ceases full-time education.
  • School fees orders

POSSIBLE ORDERS

Strict property/civil law applies to ownership of assets

The Court only has authority to declare a beneficial interest in an asset if one can be legally proven.

But there can also be further provision for children of the family (as above)

 

SCOPE OF ORDERS

Orders can be made against property worldwide (although enforcement can be difficult if assets are abroad).

SCOPE OF ORDERS

The courts only have the rights to make declaratory orders for legal status/ownership or provision for children (as above)

PENSIONS

Pension can be shared based on actual value or equality of income upon retirement

PENSIONS

No pension sharing orders are applicable for cohabitees.

RIGHTS OF OCCUPATION OVER FAMILY HOME

A spouse can be register rights of occupation against a matrimonial home held in the sole name of the other spouse. This also provides  notice of any dealings with the property by the sole legal owner e.g. about a sale or re-mortgage

RIGHTS OF OCCUPATION OVER FAMILY HOME

There is no automatic right for a cohabitee to be able to register any legal right against a home held in their partner’s sole name.

 

 

We can see from this list that there are considerable disparities between the rights of married/civil partnership and unmarried couples and those rights can also change if couples move abroad.

Pre-nuptial or post-nuptial and cohabitation agreements can provide protection to curtail significantly the potential financial risks associated with divorce in England and potentially abroad for a financially stronger spouse.

Separation agreements or cohabitation agreements can also help to regulate and thus control and plan what happens if unmarried couples separate.

If you or your clients, family or friends have any specific concerns there is no substitute for seeking independent legal advice from a family law specialist. If after reading this article you want to ask any questions, please contact Lucy Greenwood on lucy.greenwood@iflg.uk.com or by visiting The International Family Law Group LLP’s website at www.iflg.uk.com.

 

The contents of this article are for reference purposes only. They do not constitute legal advice and should not be relied on as such. Legal advice should always be sought for your specific circumstance

 

Lucy Greenwood, Partner

The International Family Law Group LLP

www.iflg.uk.com

© 30 April 18