What happens when it goes wrong for unmarried couples?

The law in relation to separating unmarried couples is misunderstood by most people: the belief in the non-existent rights of a ‘common-law’ spouse is widespread.

You will have seen from our various blogs during last year’s Cohabitation Awareness Week that there are many issues that arise when an unmarried couple, who have been living together, separate. Over the coming months our experts will be publishing a series of articles dealing with the various options available to unmarried couples who may be in dispute about their money, property and/or their children. We will also touch upon the issues that arise if one party dies.

As you will have read in our previous blogs there is no such thing as common law marriage and as such cohabiting couples are not afforded the same protection as married couples.

Family lawyers, alongside Resolution, have long called for a change in the law so that cohabitees are extended some legal protection, but for now the law remains complex and relatively narrow compared to the legal framework available for married couples when they divorce.

When an unmarried couple separate they may face the same range of problems as with a divorce, including what to do with their property and how to manage with reduced financial resources but there is no legal framework equivalent to that on divorce to help unmarried couples resolve these problems. Instead they must usually rely on the rules of property and trust law as opposed to family law regardless of the length and type of the relationship of the parties.

Couples facing such disputes (whether married or unmarried) are encouraged to avoid court proceedings and adopt a less confrontational and more constructive process such as mediation, collaborative practice, solicitor-led negotiation and Arbitration. All of these alternative options usually afford couples a gentler, more cost-effective way of resolving their issue.

Where an alternative dispute resolution process has been unsuccessful the last option is often court proceedings. The majority of financial disputes for unmarried couples that are dealt with through court proceedings are within the following legislation: –

(a) the Trusts of Land and Trustees Act 1996 (TOLATA) which is governed by the civil procedure rules and/or

(b) Schedule 1 to the Children Act 1989 which is governed by the family procedure rules.

Often, we will see applications under both statutes at the same time which can cause confusion and unnecessary complexity because there are then two sets of proceedings under two different sets of rules and which are not necessarily consolidated or heard together by one court.

Laws for separating cohabiting couples

TOLATA (The Trusts of Land and Appointment of Trustees Act 1996)

Under TOLATA, the civil court’s powers are generally quite narrow: it can order a sale of a property and decide the extent and nature of the ownership of the property. Whilst this is the same for divorcing couples, in the family court the approach is much more subjective as the civil court will very much look at what the legal position is and what the parties ‘intended’ as opposed to the objective approach in the family court where a more discretionary approach is afforded to the parties by looking at what seems ‘fair’ to the court.

In direct contrast to the court’s powers for married couples TOLATA does not give the court the power to vary co-ownership and adjust the proportions that each person owns on the basis of fairness.

When deciding what order to make under TOLATA, the Judge must take into account the following issues: –

• The intentions of the parties in relation to ownership of the property;
• The purpose for which the property was acquired;
• The welfare of any child who has (or who might be expected to have) their home in the property, and
• The claim of any secured creditor (such as a mortgagee) or any other person or organisation with a claim to the property.

Schedule 1

Under Schedule 1 of the Children Act 1989 the family court has the power to make various financial orders for the benefit of a child or children. For example, the court can order that a property is transferred to a parent until the child is an adult at which point the property reverts to the payer and/or regular payments to a parent to meet costs of child’s disability or school fees, or (in specific circumstances) to provide additional maintenance on top of child support which is paid via the Child Maintenance service.

As I said above the approach in the family court is far more discretionary and as such, when deciding what order to make, the judge will consider all the circumstances of a case, but in particular they will have regard to the following factors in relation to the parties: –

• Income, earning capacity, property, financial resources has/is likely to have in the foreseeable future;
• Financial needs, obligations and responsibilities has/is likely to have in the foreseeable future;
• Financial needs of the child;
• Income, earning capacity, property and other financial resources of the child;
• Physical or mental disability of the child;
• Manner in which the child was being or was expected to be educated or trained.

As you can see the two applications can be ‘competing’ which often leads to one or both parties asking the court to consider whether the two sets of proceedings should be conjoined.