LEGAL
Surrey’s Premier Lifestyle Magazine
The rise in couples living together
Judith Fitton, Partner at Mundays LLP, discusses the legal rights of cohabitees, examining a recent case in the courts.
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The number of those cohabiting (and not marrying) is increasing in the UK.
A bulletin from the Office of National Statistics, published in November, revealed that the number of cohabitating couples grew by 29.7% between 2005 and 2015.
Whilst married and civil partners are still the most common family type in the UK (both with and without dependent children), cohabitees have now reached about a quarter of their total and are growing at nearly three times the rate.
But this isn’t matched by a growing awareness of legal rights amongst this group. I help such couples resolve disputes about their home or their children and many do not understand that they have no personal claims on a split against each other under English law, even if they have been living together in a committed relationship for many years. There is no such thing as a ‘common law husband or wife’ and this can lead to misunderstandings or financial hardship.
Similarly, people do not often understand the ways in which a property can be jointly owned, the importance of formally recording financial contributions towards the family home or agreements about who is to own what percentage of the equity. It may be awkward to broach such delicate financial issues, but early legal advice can enable couples to avoid many common disputes.
A bulletin from the Office of National Statistics, published in November, revealed that the number of cohabitating couples grew by 29.7% between 2005 and 2015.
Whilst married and civil partners are still the most common family type in the UK (both with and without dependent children), cohabitees have now reached about a quarter of their total and are growing at nearly three times the rate.
But this isn’t matched by a growing awareness of legal rights amongst this group. I help such couples resolve disputes about their home or their children and many do not understand that they have no personal claims on a split against each other under English law, even if they have been living together in a committed relationship for many years. There is no such thing as a ‘common law husband or wife’ and this can lead to misunderstandings or financial hardship.
Similarly, people do not often understand the ways in which a property can be jointly owned, the importance of formally recording financial contributions towards the family home or agreements about who is to own what percentage of the equity. It may be awkward to broach such delicate financial issues, but early legal advice can enable couples to avoid many common disputes.
Judith Fitton is a Partner in the Family Team at Mundays LLP and has over 20 years of experience in the field of high net worth divorces. She has a particular skill in the forensic aspect of cases and investigating complex financial arrangements. Judith also has a niche practice in cohabitee matters and any disputes between non-married couples as to their property interests. She has recently been accredited as a Specialist in the fields of Cohabitee and Trusts of Land Disputes and Complex Financial Remedies on Divorce by Resolution (a national organisation of family lawyers). She has been mentioned in The Legal 500 UK as a recommended family lawyer and is known for her pragmatic and constructive advice to clients. She is a regular contributor to articles in the national press. Judith can be contacted by telephone on 01932 590557 or by email at judith.fitton@mundays.co.uk Twitter: @judith_fitton
Mundays’ Private Wealth Department can be contacted via Julie Man by telephone on 01932 590643 or julie.man@mundays.co.uk
The case of the plumbing tycoon, his girlfriend and their country cottage
The need for early legal advice is neatly illustrated by the recent case involving plumbing tycoon John Hoggins, who had his claim to a £650,000 house in Sawbridgeworth, Hertfordshire, which he bought for his girlfriend, turned down by the First-Tier Tribunal of the Land Registry.
Mr Hoggins paid a deposit of £100,000 on the house, bought as a second home, in 2009 and thereafter paid the mortgage. He had been in a relationship with his girlfriend, Greta Cerniauskaite, for five years at that point and it was decided the house would be registered in her sole name. When the parties split up in 2013, the dispute arose as to who was the true legal and beneficial owner.
Mr Hoggins claimed the house was really a joint purchase, but that as he had debts, it was “easier” to get a mortgage this way.
But the Judge disagreed and accepted Ms Cerniauskaite’s evidence that both parties intended the house to be hers, although they never actually lived in it; it was one of a series of generous gifts by Mr Hoggins, who also bought her a £160,000 Bentley car.
The need for early legal advice is neatly illustrated by the recent case involving plumbing tycoon John Hoggins, who had his claim to a £650,000 house in Sawbridgeworth, Hertfordshire, which he bought for his girlfriend, turned down by the First-Tier Tribunal of the Land Registry.
Mr Hoggins paid a deposit of £100,000 on the house, bought as a second home, in 2009 and thereafter paid the mortgage. He had been in a relationship with his girlfriend, Greta Cerniauskaite, for five years at that point and it was decided the house would be registered in her sole name. When the parties split up in 2013, the dispute arose as to who was the true legal and beneficial owner.
Mr Hoggins claimed the house was really a joint purchase, but that as he had debts, it was “easier” to get a mortgage this way.
But the Judge disagreed and accepted Ms Cerniauskaite’s evidence that both parties intended the house to be hers, although they never actually lived in it; it was one of a series of generous gifts by Mr Hoggins, who also bought her a £160,000 Bentley car.
It seems that Mr Hoggins made the gift when all was well in the relationship, but when things turned sour, he regretted the gift and sought to reclaim an interest in the property.
He failed because he could not prove that the parties had always intended the equity was to be shared – that they had a ‘common intention’. This can be shown by a written agreement or evidence that the parties had verbal discussions. But without it, his case was doomed.
The Court can only give effect to the intention of the parties. If the property is put into the sole name of one party, then this is clear evidence that this is how the parties intended the equity (or value in the property) to be held.
The Court does not have the power or discretion under the Trusts of Land Act to rewrite history and to adjust the shareholdings, unless there is clear evidence that the parties intended something else or that the claimant had made a clear contribution to the purchase and had then relied to their detriment upon an agreement that they would have a share in the equity. This is why it is so important to spell out the agreed split in a property at the time of purchase (ideally via a Deed of Trust, which our Private Wealth Department can assist with, as well as reflecting it in your Will). It is also crucially important to revisit that agreement each time the contributions to the property change (for instance when one owner funds an extension or refurbishment works without a matching contribution from the other owner).
Another aspect of this case is that the newspapers treated it as a ‘quasi-divorce’ claim and implied that Mr Hoggins’ girlfriend was seeking a share of his wealth. Despite several abortive attempts at reforming the law, cohabitees do not have personal claims against their former partners in this way and this is a prime example of the disparity between the position of a married spouse and an unmarried girlfriend.
He failed because he could not prove that the parties had always intended the equity was to be shared – that they had a ‘common intention’. This can be shown by a written agreement or evidence that the parties had verbal discussions. But without it, his case was doomed.
The Court can only give effect to the intention of the parties. If the property is put into the sole name of one party, then this is clear evidence that this is how the parties intended the equity (or value in the property) to be held.
The Court does not have the power or discretion under the Trusts of Land Act to rewrite history and to adjust the shareholdings, unless there is clear evidence that the parties intended something else or that the claimant had made a clear contribution to the purchase and had then relied to their detriment upon an agreement that they would have a share in the equity. This is why it is so important to spell out the agreed split in a property at the time of purchase (ideally via a Deed of Trust, which our Private Wealth Department can assist with, as well as reflecting it in your Will). It is also crucially important to revisit that agreement each time the contributions to the property change (for instance when one owner funds an extension or refurbishment works without a matching contribution from the other owner).
Another aspect of this case is that the newspapers treated it as a ‘quasi-divorce’ claim and implied that Mr Hoggins’ girlfriend was seeking a share of his wealth. Despite several abortive attempts at reforming the law, cohabitees do not have personal claims against their former partners in this way and this is a prime example of the disparity between the position of a married spouse and an unmarried girlfriend.
Ministry of Justice form error
It has been reported that ‘thousands’ of couples who settled their divorces in the last twenty months may have to reconsider the terms of their settlements. It has been discovered that due to a faulty code in the divorce disclosure statement (the Form E) on the Ministry of Justice website, any debts of the parties would not have been reflected in the final total for the family’s net financial worth.At Mundays, we have a separate software package and any Form E prepared by us on behalf of our clients will not be subject to this error. In any event, it is likely that in any case involving a solicitor, even if the Form was initially prepared on the MoJ software, that the figures would then have been transposed to a separate Excel spreadsheet. The totals would then have been recalculated and the problem avoided.
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