Cohabitation disputes – Do you have a fair share in your house?

01 Jun 2015

Often I am asked as a divorce lawyer to deal with the situation when someones partner passes away. One would assume that the surviving partner would receive a share of their home as a result.

Without a Cohabitation Agreement in place, the position may remain unclear. The Court of Appeal recently considered the case of Graham-York v York [2015].

The Facts
Miss GY and her partner Mr Y, an unmarried couple, had lived together from 1976 until his death in 2009. The property they had lived in was purchased by Mr Y, and put in his sole name. Mr Y assumed total control of all income derived from his business and took sole responsibility for the management of the family and household expenditure.

What were the challenges?
Miss GY argued that she not only contributed to the purchase price of the property, but also brought up their daughter, contributed to any household expenditure and cohabited there for a very long time.

The trial judge found all the witnesses to be unreliable and dishonest and there was no evidence as to her substantial financial contribution throughout her 33 years of cohabitation. If there was any contribution like the one Miss GY spoke of before, it was only minimal.

The trial judge found that Miss GY’s beneficial interest amounted to 25%. This was due to a number of findings. Firstly, Miss GY was a singer for a total of 9 years in which all of her income was given to Mr Y; this income thus assisted in the purchase of the property. However, after 1985, her income became limited; meaning if she did make a contribution to the purchase of the property there after, it would have not amounted to much.

Secondly, they also knew that Mr Y had a number of business interests, which Miss GY had no involvement in, but no findings were made as to the income generated by Mr Y. Finally, there was no express agreement as to beneficial interests. However, due to Miss GY’s contribution throughout the cohabitation, the whole course of dealing between the parties, and in line with the case of Stack v Dowden [2007], common intention can be inferred.

The Court of Appeal referred to the most authoritative guidance in these types of cases – Jones v Kernott [2011]. It is clear that the courts are not concerned with redistributive justice, but instead as being ‘entitled to that share which the court considers fair having regard to the whole course of dealing between them in relation to the property’. The enquiry of fairness is restricted to the whole course of dealing and not other factors such as the length of cohabitation and the appropriate compensation to the partner.

It is interesting to note that the Court of Appeal evaluated Miss GY’s interest at 33% rather than 25%. However, this fell within the realm of reasonableness for decision making by the trial judge.

Conclusion
Cohabitees do not have the same right as married couples. As divorce solicitor we are often asked to advise about the how a spouses rights of ‘fairness’ and ‘equality’ will prevail. However, this is not the same when unmarried couples attempt to claim beneficial interest in properties when their relationship comes to an end. When considering fairness, the courts will look at the ‘course of dealing’ in relation to the property.

In normal cases, the non-financial contribution is likely to be greater the longer the cohabitation, leading to a greater share.

A properly drafted Cohabitation Agreement would set out the parties’ intentions, potentially avoiding future stress and heartache. Our divorce lawyers in London will be happy to advise and draft such agreements for you.

Shashi Gorsia (Divorce Solicitor)

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