What is a cohabitation agreement?
Currently, the law does not provide legal rights in a relationship breakdown if you are not married. However, if you live with your partner or you are planning on moving in together, you can enter into a Cohabitation Agreement – also referred to as a cohabitation contract or living together agreement. That is a written and signed document which can set out who owns what at time of the agreement, any financial arrangements that have been agreed between the parties such as payment of bills and how property and assets will be dealt with in the event of any separation.
The agreement can record each parties rights and responsibilities in respect of a number of other issues, including:
- Ownership of Property (including arrangements for payment of the deposit at the home)
- How bills will be dealt with and shared
- Arrangements for pets
- Other assets such as furniture, cars or jewellery
It is important that when entering into a cohabitation agreement both parties are completely open about their financial circumstances and both should obtain independent legal advice before entering into the agreement. This will make it more likely that the terms of the agreement will be upheld in the event of any dispute.
It would be sensible to review and update the document at regular intervals and specifically where there has been a change of circumstances such as the birth of children. Parties should also ensure they have an up to date Will to reflect their wishes in the event of their death.
Are cohabitation agreements legally binding?
Provided the document has been drafted and executed properly and signed as a deed, it forms a legally binding contract between the parties.
If both parties provided information as to their financial circumstances at the time and obtained advice on the terms, the Court are likely to uphold the agreement.