Lack Of Legislation Protecting Cohabiting Couples Increasingly Problematic

Will, Trust and Estate Dispute experts at leading national law firm Irwin Mitchell Private Wealth are warning of the perils surrounding out-of-date wills for cohabiting couples, particularly with house prices dramatically increasing in the last decade.

The Office of National Statistics recently released its Families and Households survey results for 2017, revealing that the second largest family type is the cohabiting family at 3.3 million families. The ONS also stated the cohabiting family type was the fastest-growing of any family structure, with cohabiting families more than doubling since 1996 from 1.5 million families.

The rate of growth in cohabiting couples reflects how society’s values have are continuing to shift away from traditional marriages and household structures to suit a more flexible arrangement – however, the lack of knowledge around cohabiting and the ‘common law marriage myth’ paired with an out-of-date will can result in serious will disputes, specialists at Irwin Mitchell Private Wealth warn.

In stats released this week, family justice organisation Resolution found that two-thirds of cohabiting couples are unaware that common law marriage is a myth and has no legal grounding in the UK, with four out of five cohabitants agreeing that the legal rights for those cohabiting who then go on to separate are unclear.

Expert Opinion

“It’s very concerning that there is such little understanding around cohabitation, which in the long run can spell disaster for couples when it comes to will disputes.

“Will disputes and inheritance disputes can take years to resolve and can involve several parties, depending on who has a claim to the estate. The increase in divorce means more complex family structures are common and this can lead to many people feeling extremely disappointed when it comes to the administration of their family members estates.”

“Without any sort of agreement in place or an updated will couples could spend their entire adult lives together and literally be left out in the cold once their partner dies because they have a limited claim to the estate. The intestacy rules do not include provision for a cohabiting partner and any claim for financial provision that can be brought is limited to a claim for maintenance only, whereas spouses have a much more beneficial test in such claims and can expect to receive a much more generous award in the same circumstances.

“Cohabitees can also struggle to persuade trustees in claims for life assurance pay outs and pension entitlements which can very often be paid out automatically to spouses. Some parties can struggle to access bank accounts or even have a say on how a funeral is arranged.” Claire-Marie Cornford - Partner and Head of International Private Wealth

With house prices escalating to new, dizzying heights each year – recent figures published by Barclays Mortgages found house prices rising by up to 17pc in Birmingham, Edinburgh and Glasgow - the value of many estates has increased significantly, leading to more disputes over who should inherit the property.

Claire-Marie added: “It’s vital for cohabiting couples to update their wills if they want to avoid an inheritance dispute. Common law marriages do not exist in the UK and without a cohabitation agreement in place, which can be arranged by a private client lawyer, people cohabitating have very few legal rights. The law has fallen way behind expectations of what a modern family is, but until the Cohabitation Rights Bill is passed there are few options.

“Common issues include people having to sue their own under-16 children to get access to funds to pay the mortgage of the home they shared with their long term unmarried partner. Second and third marriages can also cause issues if wills are not updated to ensure their children from previous marriages receive an inheritance.”

“The best way cohabiting couples can protect themselves from lengthy disputes in the future is by arranging for a cohabitation agreement, which can define who owns any property and how bills are to be split. They also need to make sure their will is regularly updated to include their current partners and reflecting their current wishes.”

“Planning for eventualities now can result in a much smoother process in the unhappy event that your partner passes away. Having legal protection in place can make what is a devastating time for families easier by removing the need for litigation.”