PRESENTED BY

DARRELL WEBB

&

ANNA BURGHAM

The number of married couples is on the decline from 12.6m in 1996 to 12.2m in 2012

The average age of people getting married is now 36.2 for men and 33.6 for women

The number of couples living together has increased significantly from 1.5m in 1996 to 2.9m in 2012

1 in 4 babies are now born to unmarried couples, a rate that has nearly doubled since 2002.

Common law husbands and wives have the same rights as married couples

Couples will acquire an interest in each other’s property after a period of living together

Couples will acquire an interest in each other’s property if they have children together

Couples can protect their interest in property by ensuring it is in their sole name and they pay all the bills

Couples can seek maintenance from each other when they separate

There is currently no legislation in place to protect the rights of cohabiting couples, as there is for married couples.

So no ‘special status’ for cohabiting couples.

The only recourse available where a dispute arises is in contract law or complicated trust law, which can often result in an outcome that is unsatisfactory to one or both of the parties.

The Legal ownership:

Sole Name – One legal owner

Joint Tenants – Two or more legal owners all having the same interest

Tenants in Common – Two or more legal owners with separate defined interests

Express declaration

Where an express declaration as to how the parties wish to hold the beneficial interest exists it is conclusive ownership.

Resulting trust

A ‘resulting trust’ arises when someone other than the legal owner of the property has made a direct financial contribution towards all or part of the purchase price of the property and there is nothing to suggest that the contribution was intended to be a gift or a loan.

Constructive trust

A ‘constructive trust’ arises where two or more people acquire a property with a common intention that it is to be shared, although the legal ownership is not in all their names.

Stack v Dowden [2007]

The House of Lords held that:

“the starting point where there is joint legal ownership is joint beneficial ownership. The onus is upon the person seeking to show that beneficial ownership is different from the legal ownership”

What the Court is looking for:

“the search is to ascertain the parties’ shared intentions, actual, inferred or imputed, with respect to the property in light of their whole course of conduct in relations to it”

Assessing the parties’ shared intentions:

“many more factors than financial contributions may be relevant to divining the parties true intentions”

any advice or discussions at the time of the transfer

the reasons the home was acquired in their joint names

the purpose for which the home was acquired

the nature of the parties’ relationship

whether the parties had children for whom they both had responsibility to provide a home

how the purchase was financed, both initially and subsequently

how the parties arranged their finances, whether separately or together or a bit of both

how the parties discharged the outgoings on the property and their other household expenses

the parties’ individual characters and personalities

contributions towards financing or constructing an extension or making improvements to the property which added significantly to its value

any other factors indicating that the parties’ intentions may have changed over time

Express Declaration:

Transfer Form (TR1)

Declaration of Trust

Cohabitation / Living Together Agreement

Where a couple have a child together either can apply to the Court for any of the following orders against the other parent:

Periodical payments to the child or parent for the benefit of the child

Secured periodical payments

Lump sum

Settlement of property for the benefit of the child

Transfer of property to the child or parent for the benefit of the child

In deciding whether to make any of the above orders the Court must

consider:

The income, earning capacity, property and other financial resources of the parents has or is likely to have in the foreseeable future

The financial needs, obligations and responsibilities which each parent has or is likely to have in the foreseeable future

The financial needs of the child

The income, earning capacity (if any), property and other financial resources of the child

Any physical or mental disability of the child

The manner in which the child was being, or was expected to be, educated or trained.

Property

Section 2 of the Law Reform (Miscellaneous Provisions) Act 1970 provides as follows:

“2 Property of engaged couples

(1) Where an agreement to marry is terminated, any rule of law relating to the rights of husbands and wives in relation to property in which either or both has or have a beneficial interest, including any such rule as explained by section 37 of the Matrimonial Proceedings and Property Act 1970, shall apply, in relation to any property in which either or both of the parties to the agreement had a beneficial interest while the agreement was in force, as it applies in relation to property inwhich a husband or wife has a beneficial interest”

Section 37 of the Matrimonial Proceedings and Property Act 1970 states:

“37 Contributions by spouse in money or money’s worth to the improvement of property

It is hereby declared that where a husband or wife contributes in money or money’s worth to the improvement of real or personal property in which or in the proceeds of sale of which either or both of them has or have a beneficial interest, the husband or wife so contributing shall, if the contribution is of a substantial nature and subject to any agreement between them to the contrary express or implied, be treated as having then acquired by virtue of his or her contribution a share or an enlarged share, as the case may be, in that beneficial interest of such an extent as may have been then agreed or, in default of such agreement, as may seem in all the circumstances just to any court before which the question of the existence or extent of the beneficial interest of the husband or wife arises (whether in proceedings between them or in any other proceedings).”

The court must, therefore, consider whether either party has made a contribution in money or money’s worth to the improvement of property in which the other party has a beneficial interest, whether it had been a contribution of a substantial nature and whether, subject to any contrary agreement, a beneficial interest in the property had been acquired.

Household Contents and Personal Belongings

The principles regarding ownership are broadly the same as those applying to property for property.

Express Agreement – an express declaration as to beneficial ownership

Resulting Trust – any contribution towards the purchase price

Constructive Trust – the existence of any agreement between the parties as to ownership or the parties intentions (express or implied), regardless of contributions.

Existing Property – generally items owned by either party before the engagement or bought by one party from their own resources during the engagement, will remain the property of that party.

The ringThe legal position is governed by section 3(2) of the Law Reform (Miscellaneous Provisions) Act 1970:

“(2) The gift of an engagement ring shall be presumed to be an absolute gift; this presumption may be rebutted by proving that the ring was given on the condition, express, implied, that it should be returned if the marriage did not take place for any reason .”

34% of marriages are expected to end in divorce by the 20th wedding anniversary

The number of divorces in 2011 was highest among men and women aged 40 to 44

The average duration of marriage for divorces granted in 2011 was 11.5 years

The orders fall into two main categories: income orders and capital orders.

The income orders are: Periodical payments (maintenance) Secured periodical payments

The capital orders are: Lump sum orders Property adjustment order (for property to be transferred or

held on trust) Orders for sale Pension sharing orders

In deciding whether to make any of the above orders the Court must consider:

Income, earning capacity, property and other financial resources of the parties

The financial needs, obligations and responsibilities of the parties

Standard of living enjoyed by the family

The age of the parties

Any physical or mental disability of either of the parties

The contributions which either party has made or is likely to be made in the foreseeable future

The conduct of each of the parties

Any benefit which, by reason of the divorce, either party will lose the chance of acquiring

The existence of a pre-marriage agreement

All the circumstances of the case including the welfare of any minor.

Pre or Post-Marriage Agreements

Radmacher v Granatino [2010]

“The Court should give effect to a nuptial agreement which is freely entered into by each party with a full appreciation of its implication, unless in circumstances where it would not be fair to hold the parties to the agreement.”

Whether or not a pre-marriage agreement will be considered fair will depend on the facts of each particular case, but generally the Court will look at the following:

that the agreement does not prejudice the reasonable requirements of any children of the family

that the agreement makes provision to meet the parties needs and to compensate them upon divorce

that the agreement addresses the existing circumstances and not merely the contingencies for the future

An agreement would not be consider unfair simply because it distinguishes between wealth accumulated during the marriage and pre-marital property or property that one party expects to receive from a third party.

The circumstances surrounding the making of pre-marital agreements will also effect the weight given to them by the Court upon divorce.

In summary these factors are as follows:

whether there has been any duress, fraud or misrepresentation.

whether there has been any other unacceptable conduct by either party

whether the parties have received legal advice and provided full disclosure of their assets and financial circumstances

whether the agreement was signed at least 21 days prior to the marriage

whether the parties intend the agreement to be legally binding

the parties’ ages, maturity, previous experience of relationships and marriage

Please contact us with enquiries:

Address:

Providence House

Providence Place

Islington

London

N1 0NT

T: 020 7288 4700

E: info@boltburdon.co.uk

W: www.boltburdon.co.uk