Are Cohabitation Agreements Legally Binding?
If you are in an unmarried relationship, you will be encouraged to sign a cohabitation agreement. In this blog, our Family Law Solicitors look at what a cohabitation agreement is and answer your questions on whether it is legally binding.
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For family law legal advice call the expert London family lawyers at OTS Solicitors on 0203 959 9123 or complete our online enquiry form.
Our lawyers speak Arabic, Armenian, Farsi, French/Mauritian Creole, Spanish, Tamil Tagalog/Ilonggo, Urdu/Punjabi
What is a cohabitation agreement?
A cohabitation agreement is a document signed by a couple who are in an ongoing unmarried relationship. It sets out how their property and assets will be split if they separate.
You may have been told to sign a deed of trust and be confused by how that differs from a cohabitation agreement. A property solicitor may suggest a deed of trust if you are buying a property with your partner and you want to record how much you will each get if the property is subsequently sold. A cohabitation agreement is like a deed of trust but it is more comprehensive and can cover additional assets, such as furniture or bank accounts, and say who is responsible for the mortgage and payment of other outgoings.
Our Family Law Solicitors recommend a cohabitation agreement because it is best to cover all the things that you may fall out about with your unmarried partner. For example, how are you going to pay the mortgage and other bills? Will the payments be equal or in the proportion that you own the property? What happens if one of you can't pay your share of the mortgage? Does one of you have the right to buy the other out if you split up? If so, who will value the property and how long does the partner staying in the property have to raise the money to pay their partner out? Can the partner stay in the property until they receive their share of the equity?
In addition to these property-type issues your cohabitation agreement can also cover lots of other issues, such as ownership of pets or use of cars or if it is agreed that you will each leave your share in the property to your surviving partner in your respective Wills.
Do you need to own a property to sign a cohabitation agreement?
Anyone in an unmarried relationship should have a cohabitation agreement whether they own their own home outright, with a mortgage or rent.
With renting becoming increasingly common in London many renters are now in their 30s, 40s or older but don’t realise why they need the protection of a cohabitation agreement.
Firstly, if you are renting from a landlord you could end up with family law problems and a landlord and tenant issue if you split up from your partner. Landlord and tenant law will be relevant if there is no cohabitation agreement in place and you are both named on the tenancy agreement. It is surprisingly common for two tenants to both want to stay in a property if they split up. That’s because it is so difficult to find anywhere to rent in London and that situation is likely to continue.
Secondly, your cohabitation agreement can cover more than what happens to your rental property if you split up. It can also cover potentially contentious topics such as pet ownership, who keeps the furniture, air miles or how any credit card debt, loans or bank accounts are to be dealt with.
Is a cohabitation agreement legally binding?
Most cohabitation agreements are binding. Although they are not commercial contracts you can rely on them provided the agreement is validly entered into.
For a cohabitation agreement to be valid it must:
- Have been entered into freely – with no coercion or pressure
- Be a deed
- Signed by both parties to the agreement
- Not affected by life events
To show that your cohabitation agreement was entered into freely it is important that both you and your partner take independent legal advice on the document.
Many people question what life events can stop an agreement from being binding. Here are a couple of examples:
- You get married to your partner– your marriage means you have rights as a husband or wife. The family court in divorce proceedings can make a range of court orders including orders about the house, pension, savings or family business. In financial settlement proceedings, the court considers a range of statutory factors that look at needs rather than property rights. If you want to preserve or tweak what was agreed in your cohabitation agreement you need to sign a prenuptial agreement before you get married
- You or your partner dies – if the cohabitation agreement was silent about what happens if one partner dies and there is no Will then you won't be your partner’s next of kin and you may not inherit any of their estate. You may be able to bring a claim for a share of the estate but that can be complicated. That’s one of the reasons why it is best to ensure your cohabitation agreement is comprehensive and you both write Wills and keep them up to date
- You have children with your partner – if you have children and their arrival is not covered in the cohabitation agreement or it is said that no claims can be made for children then this will not be upheld. You cannot stop a parent from being able to apply for child support for their child and you also cannot stop them from applying for housing provision for their child if you split up. A housing claim for a child does not affect your share of the equity in your property but it may mean the court orders that a property is made available to house your child until they are 18 and then the property reverts to you. These problems can be avoided if your cohabitation agreement addresses what happens if you have children or says that your cohabitation agreement will be reviewed if you have children
Family Law Solicitors recommend that you take specialist legal advice before signing a cohabitation agreement and that your agreement is regularly reviewed, especially if there is a major change in circumstances, such as:
- The birth of children
- One of you receives an inheritance, gift from parents or a lottery win and wants to use the money to pay off the mortgage on your property
- You move house
- You decide to extend or renovate the property and how you are funding the renovation affects the fairness of what is recorded in your cohabitation agreement
- You or your partner is at risk of bankruptcy
- You or your partner lose your employment and are unlikely to be able to get another job
How can OTS Solicitors help you with your cohabitation agreement?
At OTS Solicitors our Family Lawyers specialise in unmarried relationship law and cohabitation rights. We are highly experienced in drawing up cohabitation agreements sensitively and fairly.
Online and London Family Law Solicitors
For family law legal advice call the expert London family lawyers at OTS Solicitors on 0203 959 9123 or complete our online enquiry form.
Our lawyers speak Arabic, Armenian, Farsi, French/Mauritian Creole, Spanish, Tamil Tagalog/Ilonggo, Urdu/Punjabi
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