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Living together agreements

There are many good reasons why a couple might not want to get married. They may simply not be ready to make such a significant legal and societal step or there may be personal reasons why they do not wish to get married at all. Of course, that does not mean that they are not in a committed relationship or that they are not financially, domestically and/or emotionally dependent on each other.

However, the law does not acknowledge the reality of this relationship (see [article on cohabitation - insert hyperlink]). A couple can easily become financially reliant on each other and the finances in the relationship become mingled. In such circumstances the legal position as to who has to pay the mortgage or bills, or who is entitled to which assets if the couple break up, can fail to reflect the reality of how the parties have treated those outgoings or assets previously. Any oral agreements or understandings that the couple have may not fulfil the legal formalities to be enforceable and, even if they do, they can be difficult (and costly) to evidence. In such circumstances it might be wise to formalise the aspects of the relationship. In most cases this can be achieved through a 'living together' or 'cohabitation' agreement. It should also be noted that same-sex couples could also formalise their relationship through a civil partnership, although this is a very significant step which has the same legal consequence of marriage (different-sex couples cannot have a civil partnership in England & Wales).

What is a 'living together' agreement?

A living together agreement is a contract between a couple and therefore it can cover anything that they agree. It is therefore very flexible. It can be entered into at any time, whether a couple are just moving in together or if they have been cohabiting for years. Typically, it will:

  • show each party's assets and liabilities at the time of the agreement;
  • state what the financial arrangements between the parties are going to be;
  • state what (if anything) is to happen at future key events, e.g. if the couple have a child; and
  • state how the assets and income will be divided if they split up.

It should usually be signed by both parties as a deed, in front of a witness, after each receiving independent legal advice. Like pre-nuptial agreements, living together agreements will only be potentially enforceable if the couple give full and frank disclosure of their assets and liabilities, usually by listing them in a schedule to the agreement.

Matters you could cover in a living together agreement

The agreement can cover many arrangements, for example:

  • The couple's home. The legal ownership of the home will often state that one party owns the entire property or that they both own it equally, but this may not be what the parties intend. The agreement can formalise any informal arrangements between the parties, such as what proportions the house is owned in. It can also say who is responsible for mortgage or bill payments.
  • Bank accounts. It can state which assets are joint and the situations that money can be used from the joint account.
  • Personal possessions. The agreement can show the assets which are individually owned and what should happen to which assets on separation.
  • Pensions. The couple can agree to nominate each other for death-in-service benefits.

Any of this can be varied at a later date by agreement (usually by another deed) and the agreement can state that it must be reviewed after a period of time.

Are there any restrictions on what they can cover?

The agreements can cover many arrangements, but there are some limitations. The agreement:

  • cannot restrict or remove a party's right to claim child maintenance from the other;
  • cannot prevent the court from deciding on any child arrangements, such as contact or residence;
  • cannot require third parties, such as trustees, to do anything;
  • should not deal with what should happen to a party's property on death unless tax advice is first obtained;
  • might not deal with how foreign properties are held. Legal advice will have to be obtained from foreign lawyers as to the effect of the agreement on any foreign property and whether the agreement is enforceable in that jurisdiction.

How can we help?

In the first instance, we can advise you as to what it would be advisable for the living together agreement to cover. We will then help you collate and present your financial disclosure and draft the agreement. If necessary, we can help put your partner in touch with another family law specialist so that he or she can obtain advice.

We are also able to advise a financially weaker party on the effect of a living together agreement instigated by their partner on their rights; whether it is to their advantage, financially or otherwise, to enter into the agreement; and whether the provisions of the agreement are fair. If appropriate we can negotiate on your behalf with the other party's solicitor to improve the proposed terms.

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Oxford
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Telephone: +44 (0)20 7629 7411
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Email: bh@boodlehatfield.com

Bankside Office

240 Blackfriars Road
London
SE1 8NW
DX 53 Chancery Lane

Telephone: +44 (0)20 7629 7411
Fax: +44 (0)20 7629 2621
Email: bh@boodlehatfield.com

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