The Smart Divorce Podcast

Cohabitation and the potential law changes

• Tamsin Caine • Season 9

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Graeme Fraser

Graeme is Head of Family at William Sturges and has specialised in family law for over 25 years. He has considerable experience in advising on financial settlements involving complex assets and substantial wealth. His practice covers divorce, financial settlements involving complicated assets and substantial wealth, children issues, marital agreements, cohabitation, intervenors, insolvency-related settlements, European Family law, relationship breakdowns, tax rules on divorce, use of experts, corporate and family law strategic advice and multi-ethnic law.

Graeme is well-known in the legal community through thought leadership, committee work, training Members, and being a media spokesman for the BBC, SKY, FT, and Times. He has spearheaded the campaign for cohabitation law reform in England and Wales. As Chair of Resolution’s Cohabitation Committee, he has been able to influence practice and policy that positively impacts his peers and improves outcomes for separating families.

https://www.williamsturges.co.uk

Tamsin Caine

Tamsin is a Chartered Financial Planner with over 20 years experience. She works with couples and individuals who are at the end of a relationship and want agree how to divide their assets FAIRLY without a fight.

You can contact Tamsin at tamsin@smartdivorce.co.uk or arrange a free initial meeting using https://bit.ly/SmDiv15min. She is also part of the team running Facebook group Separation, Divorce and Dissolution UK

Tamsin Caine MSc., FPFS
Chartered Financial Planner
Smart Divorce Ltd
https://smartdivorce.co.uk

P.S. I am the co-author of “My Divorce Handbook – It’s What You Do Next That Counts”, written by divorce specialists and lawyers writing about their area of expertise to help walk you through the divorce process. You can buy it here https://yourdivorcehandbook.co.uk/buy-the-book/

To learn more about our podcast sponsor Ampla Finance – access their product guide here: https://bit.ly/3Ieqmuc
Or complete enquiry form https://bit.ly/3W4J7pz and one of the team will be in touch.


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Tamsin Caine:

Hello and welcome to another bonus episode of the Smart Divorce Podcast. Today we're going to be talking cohabitation If you're living with a partner and you separate. What happens and why there is a need for cohabitation reform in this country, and I am delighted to be joined today by one of the leading experts on this subject, Graeme Fraser.

Tamsin Caine:

Graeme is Head of Family at Williams Surges and has specialised in family law for over 25 years, although I'm not sure he looks old enough for that, but there you go. He has considerable experience in advising on financial settlements, in involving complex assets and substantial wealth. He's well known in the family law community through thought leadership, community work, training members and being a media spokesman spokesman, maybe, sure you should say spokesperson and he has spearheaded the campaign for cohabitation reform in England and Wales. As chair of Resolution Cohabitation Committee, he has been able to influence practice and policy that positively impacts his peers and improves outcomes for separating families, and I think it's fair to say there's still some work to do. Hi Graeme thank you so much for coming along and joining us today.

Tamsin Caine:

Hello, tamsin,

Tamsin Caine:

and thank you so much for coming along and joining us

Tamsin Caine:

today.

Graeme Fraser:

Hello, tamsin, and thank you very much for that introduction.

Tamsin Caine:

No pleasure. So let's start with the myth of couples who live together with no civil partnership and no marriage being somehow called common law husband and wife and therefore that in giving them similar rights to a married couple. So that that's absolutely not the case, is it?

Graeme Fraser:

no, it's not the case, but it's a very wide perception and a series of surveys have been done, called the British Attitudes Survey, which is funded research done by universities, and it's become clear from those surveys that a large part of the population slightly less than half the population, the adult population do believe they have the same rights on divorce as they would if they had been cohabiting. And, most worryingly, that myth is most widely held amongst those very people who are the ones who might be experiencing relationship breakdown, given their age groups. What we can tell you is that the law is completely different if you are living together as opposed to being married, and the law actually isn't a specific area of family law, it's right across the law. So it's actually quite difficult to work out what people's rights are, but essentially there are very limited property law rights and there are some rights for children of unmarried couples.

Tamsin Caine:

There are also rights in Tamsin areas of law, such as housing and social security, work and things like that, but but essentially it's a whole hodgepodge and it's not um how you would look at the law if you had been married very different okay, can we take a a sort of an example of a couple who've been living into in a house perhaps she's moved into his house, um, and she's been contributing to the family in terms of, um, perhaps paying half the mortgage amount even though she's not named on it, perhaps contributing to bills, and so on, what? What would be the position if that couple were cohabiting? And what would be the position if that couple were married?

Graeme Fraser:

Yeah, it slightly depends, tamsin, on whether they've got children or not. But if we leave the children to one side for the purpose of this example, which I think makes it clearer, we can talk about children maybe a bit later on. The situation is that if you live together, it doesn't matter how long you've been living together at all, and it doesn't matter what contributions have been made. The only contributions that are relevant is how much has been spent on buying the family home, so, in other words, what is spent at the time that you buy the property, so what is put down on a deposit or on the balance when you buy the property, and then how the mortgage is paid. In the absence of being able to prove that, it's very, very difficult indeed to assert rights. And in the example you've given, which I believe is where it's in the man's name which we're being gender specific, it is very, very difficult for the woman in that situation to prove that she has rights. In order to prove that she has rights, she's going to have to prove that there was something called a common intention, constructive trust, that there was something called a common intention, constructive trust. I'm not going to attempt to explain that because that would take about an hour just to do to family lawyers. So I'm certainly going to attempt it on this podcast, but proving that is very difficult.

Graeme Fraser:

But from practice, what I can tell you is that what happens at the time that you buy the property is really, really important, and what was documented at that time is important.

Graeme Fraser:

That of course, the difficulty for couples is that they don't know that's the law, so they don't go into that transaction, buying a property together, thinking that that's the most important thing. Now we do know that conveyances send out what's called a report on title, encouraging people to explain how they're going to hold property. But the reality is that people aren't focused on that at the time. They're focused on what they regard as opposed to happy events buying a property, and that they're focused on that and they're not thinking about what discussions they were having and what was being recorded at the time. And then they find out much later down the line, perhaps when the relationships and difficulties, and then they get legal advice, that the law is that you might not have any rights at all and it's too late to do anything about it. So so that's essentially the dilemma under the current law and if that couple were married?

Tamsin Caine:

Yeah absolutely wouldn't be the case, would it?

Graeme Fraser:

yeah, no, the the law is completely different. So the situation if you're married is Graeme, um, there is legislation that applies, um, and it's a discretionary legislation, so it's it's based on a range of factors, but essentially a court, in that situation, has the powers to make any orders it sees fit in relation to property. But, importantly, through the principles that have been developed over the last 25 years or so, the principles that have been developed over the last 25 years or so, it's clear that where a home is used as a family home, particularly as part of a marriage, then the starting point very often not always, but very often, particularly after they've been there for a reasonable amount of time, say 10 years that they will, they will automatically be sharing so that, so the, so the property will be. The starting point is the property is divided equally. And that's not the case, um, if you're not married, because it will largely be what the uh title deed say well, that's a massive difference, isn it?

Tamsin Caine:

And you mentioned that where there are children involved, there are differences as well. So, harry, basically, can you talk us through some of those differences?

Graeme Fraser:

Yeah, well, the starting point where there are children is that there's something called the Child Maintenance Service, which used to be called the child support agency, and I think at one point it was called cmec. Doesn't really matter how you label it. Um, doesn't work particularly well, unfortunately, uh, I have to say, but I think what came before it didn't work particularly well either. So, um, but essentially that is the scheme, scheme by which the parent with care, very often the mother, is entitled to financial support to the parent who's not living with the child, so often called the non-resident parent, often the father and that and that scheme operates under a formula based on a percentage of that person's income, also taking into account the amount of time the child spends living with the parent whom the child isn't living with, so in other words, nights during the week spent with father. So that's the starting point, but on top of that, there is also other law, which is a part of the Children Act, which provides, in certain circumstances, financial provision for those children. Now, this part of the law is not used very much and it's often seen as a top up to that child maintenance scheme and it's very rarely accessed, possibly because a lot of people don't know about it and, secondly, it's usually available only to people who can afford it. So the threshold is quite high to access it in the first place.

Graeme Fraser:

And one of the criticisms that's made of the current law and I think a perfectly valid one is that children should be entitled to the same financial provision and rights, irrespective of whether their parents are married or not. But here we are in 2024 and the reality, I feel, is that children of married parents tend to be much better off financially at the end of a relationship than those of unmarried parents, and I say that that's completely wrong. Having said all of that, tamsin, in a situation the example that you provided where there are children, in that situation, if it's affordable, it is possible for a property to be held for the children to live in while they are growing up, um, but it is only for a specific period of time. So it could be until, um the children are 16 that there would be all finished their full-time secondary education. It is dependent on the mother doing all that she can to support the situation, which will probably mean having to work and pay towards the mortgage as much that period.

Graeme Fraser:

Then, based on the law, then that property will go back to the division that I explained at the beginning, which is based on the title deeds, unless you can prove intentions were different to hold the property in a different way. So what you find there in pretty much all instances is that where the woman becomes older and the children are older, she has very little, very limited, if rights at all at that stage and and that's the the predicament that women find themselves in that situation. And so, in contrast to what happens when you're married, there is no acknowledgement of the contributions that a woman would have made as a mother and in terms of looking after the home. And that's essentially the situation that women sometimes find themselves in when they go to see solicitors Resolution. Our national organisation has run a series of member surveys on this and has found that in nearly all cases, lawyers found that they found themselves in situations where there was nothing they could do to help their clients when they were in that situation it's so frustrating and and upsetting, isn't it?

Tamsin Caine:

because you've got a client who comes in and thinks well, I must be entitled to something, I've been financially contributing, and so it feels to me, and I'm sure to you, that something needs to change. And there are jurisdictions throughout the globe who do have different cohabitation laws, and my understanding is that we're looking at a couple of those to try and persuade our government to to make some changes to cohabitation laws. Um, is that that's the case? I've understood that right. Yeah yeah.

Graeme Fraser:

So just to break that down a little bit, at the point that we're recording this, we're we're at the start of a new government and a change of political party running that government and in the labour manifesto there was a commitment to achieve better protections for cohabiting couples and I think the wording was specifically towards improving rights for women. Now we're not quite clear what that means yet and I believe there will be discussions with the new government about what that means and we will see how that unfolds in the first hundred days of any new government where there's been a change of political party, there's obviously a lot of change anyway. So let's wait and see what happens on that. Yeah, fingers crossed.

Graeme Fraser:

However, in terms of what's happened across the globe, as it were, there are two main types of model that exist, and the first model is called a difference model and that exists actually within the British Isles, in Scotland and Ireland, particularly in some of the Commonwealth countries, whereby couples are getting the same rights or very similar rights to those of married couples after a certain period of time or if they've had children. So those are the two models. Essentially, I think they're called either the difference model or the de facto model. Those are the two main types of models that operate across the globe and we have looked at those comparative cases in order to inform us what might work here. And that's been the subject of some research and it's the subject of some discussion and it's probably the subject of some policy consideration as well.

Tamsin Caine:

Is there a I don't know consensus feels like the wrong word, but a preference between those models that we see elsewhere in the world that we might feel was more appropriate for the UK, or one that we're certainly a resolution are going to the government and saying we think this is the right solution.

Graeme Fraser:

Well, I think the answer is there's several different aspects to that answer. I think over time, over the last 40 years, which is the period since which Resolution has been campaigning, there was a case called Burns and Burns in 1983, which basically was the example that you were talking about at the beginning, which is a woman finding herself at the end of a relationship with no rights at all. And I think that over many years, certainly in this country, there have been a series of arguments for the difference model, and that was very clearly the case in terms of the recommendations made by the Law Commission in 2007. And the Law Commission is set up to suggest new laws to the government, and that was on the basis of a limited scheme, but with a wider discretion. So a similar discretion, but on a more limited basis, to what would happen on divorce in this country. But, on the other hand, there have been other countries where this law has worked quite well, and, in particular, australia and New Zealand.

Graeme Fraser:

I'm not saying it's perfect. There were criticisms of that, as there were criticisms of any law, but the argument by those who would like to see marriage like rights is that it's likely to be easier to implement and the law is likely to be clearer and probably a bit more accessible. The issue, however, is probably one of policy, which is is it right to give people who have not chosen to marry automatically the same rights after a period of time, or does the decision to marry make a decision, make a difference? Because that's a conscious decision, and there are certain things about marriage that I think people do understand At a basic level.

Graeme Fraser:

People understand that marriage means something different in law, so is it right to extend that, and what would work best for this country as opposed to what works elsewhere, because each country has a slightly different culture and a different approach to how they want their laws to be run. The other thing that's been running through the law for many years terms in is this idea that families want to make decisions for themselves about what happens in their future. So when people get married although if we were having this discussion 20 years ago, we would then be talking about, oh, nuptial agreements that never happens in England, that's just something that happens in Hollywood Well, nowadays, nowadays, nuptial agreements are very common, so the law generally does respect the independence of people to make decisions about what happens when their relationship comes to an end. So one of the queries about introducing new law is how much respect would be given to that independence as to what people want to do.

Tamsin Caine:

Crikey, it's tricky, isn't it? I mean, you've got feeling. My gut feeling kind of feels like, well, if you've lived together for a certain amount of time, it feels right to have similar rights as a married couple. However, there is the point that you say that you might almost fall into that, whereas if you, if you marry or enter into civil partnership, you are making a a firm decision to enter into that as a partnership and and kind of financially link yourself to another person. So that does that feel In terms of the difference model, and I feel like this is going to be perhaps really complicated and potentially beyond the scope. But what differences does the difference model have to what the rights are of a married couple or a civil partnership?

Graeme Fraser:

Well, the difference model is based on several elements. First of all, you have to be eligible in order to qualify on the difference model. And eligibility either means, under the Law Commission model and some of the proposals that Resolution has made over the years, that would mean automatically having children it doesn't mean that in some other countries but it also means being in a recognized cohabiting relationship for several years, and there have been a number of ideas about that, whether it should be two, which reflects laws that are available to inhabitants on inheritance legislation, or it could be three years, which is more based on what happens under children law, or it could be five years to allow a longer period for eligibility. But that's one of the starting points.

Graeme Fraser:

And then, under the difference model, there is really a question of looking for some sort of qualifying contribution having been made to the relationship, which may be an active contribution or it may have been something that was a sacrifice that was made, what I suppose we would term and I'm sorry, I don't want to get too technical, but it's what's called relationship. It's called relationship generated disadvantage. So as a result of being in the relationship, you may have given up career opportunities or you may have made active contributions the sort of contributions you were talking about right at the beginning of this discussion to looking after children or making active contributions to the family home but they're not actually contributions that are ones that add value to the property or show that you are a property owner what we call the beneficial ownership. So it's recognising those contributions in a certain way, and I think the model that we see where that's happened most closely to us is in Scotland, and that was actually the model that the government wanted to look at following the Law Commission report back in 2007.

Tamsin Caine:

2007. Okay, so I guess the relationship disadvantage can't remember what you called it something fancy would be like if, if the one of the partners had a job in germany and and the whole, then the couple moved lock back and and barrel to Germany for a couple of years. That would potentially be the example of of that sort of thing, would it?

Graeme Fraser:

Yeah, I mean it's giving up, it's making sacrifices in order to possibly it could be supporting the. I used to use the gender of male and female, but of course we know, um, that actually it's a lot more complex than that. Uh terms in, because there are many men who, uh, many men who actually now stay at home as well. I suppose we call house husband and also we have part-time working and shift working, so people work in many different ways and um in in in the 21st century. But but essentially, if we look at a more traditional model, then, um, mothers who gave up their career possibly followed the father um gave up. They sometimes they actually sell their property, but they these aren't situations actually, perhaps where the father is more aware, but they're not but they're not being allowed to invest their share in the father's property, so they don't have anything to show for it and they may actually have spent that money, but it's something that can be that can be tracked, but it's something that can be that can be tracked. And the point is that, having been able to show those contributions or sort of or sacrifices or any disadvantage suffered, that you can then have access to the menu of remedies available under financial remedies on divorce, which allows a much more flexible way of giving financial provision. So, for example, what we don't have now is it's not possible to share pensions if you're unmarried, and also there are limits on what we call a carer's allowance, which enables mothers to go back to work. That's not really fully developed. And also there would be an opportunity under the new law to pay what's called maintenance or periodical payments, possibly for a short amount of time, which allows women in those situations to get back on their feet and is often very helpful in marriages, particularly short marriages. So it's really allowing flexibility in the law to provide with these situations.

Graeme Fraser:

And what I say about all of this is that it's not about encouraging us to have a whole load of new cases in the law courts.

Graeme Fraser:

That's not what we're talking about at all. Obviously, there will be test cases, as there would be on any new law, but it's about encouraging the law to grow in a way that works for families, which means that when we look to settle our cases, they're much easier to. So if you go through mediation or collaborative law or these types of models, cases that have fairer laws are easier to settle and actually family lawyers do settle most of their cases. The cases that we can't settle are because the law is hard, and then you end up with families not actually having a remedy, either because they couldn't access it in the first place or there simply isn't something fair to do. But then you're relying on the couple itself to agree to enter into something that's fair, but it doesn't say that in the law. So it's much better for the law to say what is fair, so that we can reach those solutions sure, I mean that that makes complete sense.

Tamsin Caine:

My, um, my question so we, um, we both attended and you took part in um a debate on on this very subject, um, a couple of months ago, um, and my, when I was thinking about it before the event, and I was thinking about what, what do I feel about this? How, what questions have I got? My overriding question, as a complete novice and not as a lawyer, was how how does do new laws, how are they going to apply to couples who are in a relationship together, as opposed to people who know each other buying together, so you and me buying together, me buying with my sister, you know a couple of friends buying together. How how do we go about establishing there's a relationship there as opposed to it's a, it's a friendship, buying a property together? Because you can't really can't, mix those things up, can you?

Graeme Fraser:

because the rights then become very confused well, I think you've made a very good point, um, and it's certainly if. If we do see new legislation being debated in Parliament, I think the point that you've made will come up, which is that people will say well, if you're going to have new legislation for people living together in a relationship, why can't that extend to friends or people in a sibling relationship or something like that? I do think that we are looking at something fairly clear here that these are people who aren't married but live together as though they are married without the formality of marriage, without the formality of marriage. So I personally think that it is necessary for that couple to be in an intimate relationship. Not everybody agrees with that, but I think that's hugely relevant to it. But I think living in the same space, living in the same property, being in that relationship and having usually having some financial interdependence between them are clear markers, and so there's a parallel to be drawn to being married.

Graeme Fraser:

I personally think that those other categories would probably fall more under property law, but for anybody who wants to buy a property, there is always an option to enter something called a declaration of trust, which clearly sets out how you own that property, and you can also enter into an agreement and we call them cohabitation agreements, um. I've seen them called family life agreements, um. But you can. You can decide within those agreements how you want to regulate um, how the household is run, how you may own property in the future, what you decide to do on death and what you decide to do in the event of a breakup. And I don't think, and that would certainly still be possible within those categories, obviously the relationship would be different. But you can.

Graeme Fraser:

You can regulate those and, in fact, some ways, it's easier to regulate those situations because it's more, I suppose, more of a business-like relationship rather than a family-type relationship, and I think the existing law is better suited to people in a business-type relationship, for example, tamsin, a couple or maybe four people owning a guest house or a commercial property, and that really was what this property law that we currently apply to people living together is better suited for, and the laws are slightly differently applied. But I do think there's a distinction. I do think there's a conversation to be had and I think it will be had, but what I would say is the number of people who are affected at the moment is so great that we just can't, we can't ignore it and we know from the demographics, the recent censuses, that it's now one in five adults who are in a relationship are cohabiting, and I just say that we cannot ignore 20% of the population. It is actually the biggest priority in terms of new family law is to bring in law that protects those people.

Tamsin Caine:

I think you're absolutely right. It's amazing that it hasn't happened yet and let's hope that currently the government get on to this. But, as you say, they've got a lot of things on at the moment. But let's hope that they stick with the terms of their manifesto and start making some changes. We're coming to the end of our time together. Is there anything you'd like to add or anything that you think that I should have asked about? That we haven't covered.

Graeme Fraser:

I think the thing to emphasise is that the people who are getting together so they're buying a property together or maybe they are in relationship difficulties it's the importance of getting advice as soon as possible, and that's probably going to work best in terms of a combination of advice. So you're going to need advice from your legal advisor and try and get that advice quickly. Don't rely on the internet, please, because because we provide bespoke advice to your situation and everybody's family is different and every situation is different, so do get specialist advice and also be aware that we link up with different services, so sometimes it's counsellors or or relationship coaches, I think, as we call them and and also you know, it's a whole myriad of services. It's not usually one person on their own. So getting that advice early really makes a difference, and I think, in terms of the law, what a lot of people say about this was well, it should be obvious that if you're not married, you don't have rights. If you want to get rights, get married. Actually, what it's about is awareness, so being aware of what the law is now, but also having that with modernised law. So what we need to do going forward is make sure that we have laws that work for all families, irrespective of whether they're married or unmarried not a subject of this discussion but we should always be reviewing our laws to see if they work and, at the same time, making sure that the public are aware what the law is as well. So we've got a dual role and I think it's really anybody working within family law has that responsibility and making sure that we can clearly communicate to people what the law actually is, what their rights are and what they can do about it and what they should be doing about it. And I think if they think in those terms, then you're really protecting yourself in the future and informing yourself.

Graeme Fraser:

And you might actually have, because there are plenty of people who aren't breaking up, who are still concerned about it. You may just have a little bit of clarity going forward, because one of the worst situations in life is, um, unfortunately, when people do break up. It's probably the second biggest trauma after death. So instead of having that situation unearth itself in a really unpleasant and untimely way and then finding out the law doesn't work very well, take steps that you need to you know quite early on, so you know, make a will. Think about having a cohabitation agreement, think about having a declaration of trust. Keep one eye out for when the law is changing. You know, I don't think the law family law doesn't change particularly quickly in this country and then, as a result of that, people often think the law is different to what actually what it actually is. So getting really clear, um, reliable advice and getting that with all the services that are available is really the best thing you can do in that, in this situation no, absolutely spot on.

Tamsin Caine:

And and I know lots of people who listen to this podcast are coming out of a marriage or a civil partnership and thinking about entering into another one and saying, well, I'm never getting married again and not understanding the implications of that, of that cohabitation and and I think you think a cohabitation agreement and getting legal advice is absolutely paramount up front if you're entering into a relationship that's new, because you don't want to come out of that and find that you're in a different position than the one you thought you were. Graham, thank you so much for all your um wise words today and it's been great to speak to you. Thank you for joining me.

Speaker 3:

Thank you times in hi, and I hope you enjoyed that episode of the smart divorce podcast. If you would like to get in touch, please have a look in the show notes for our details or go on to the website, wwwsmartdivorcecouk. Also, if you are listening on apple podcasts or on spotify and you wouldn't mind leaving us a lovely five-star review, that would be fantastic. I know that lots of our listeners are finding this is incredibly helpful in their journey through separation, divorce and dissolving a civil partnership. Also, if you would like some further support, we do have a Facebook group now. It's called Separation, divorce and Dissolution UK. Please do go on to Facebook, search up the group and we'd be delighted to have you join us, and the one thing I would say is do please answer their membership questions. Okay, have a great day and take care.

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