Contributions to property by those unmarried, but living together

The Court of Appeal has recently published its decision in the case of Southwell v Blackburn [2014] EWCA Civ 1347 for an ex-partner to pay a lump sum to his previous partner when they split, despite them not being married and her name not being registered as a joint owner of the house they lived in but had both contributed to.

Despite long standing pressure upon the Government for reform, the law regarding the property rights of unmarried couples who live together remains complex. With no general rule which governs these cases, outcomes are difficult to predict as they are reflective of the individual circumstances of each case.

In the above case, Miss X - who previously lived with her two daughters in rented accommodation which she had spent £15,000 on furnishing and fitting - met Mr Y, and after a 2 year relationship, they decided to move in together as a family.

They embarked on a hunt together for a new family home and on finding a property, Mr Y purchased the property in his sole name with the sale proceeds of his previous property (worth £140,000) and an additional mortgage of £100,000, and the couple and Miss X’s children moved into the new home.

When Mr Y and Miss X’s relationship broke down which resulted in them splitting up, the Court of Appeal upheld that Miss X should receive a lump sum payment of £28,500 from Mr Y.

The payment of the lump sum followed the Judge’s view that Miss X acted to her detriment in giving up secure rented accommodation which she had invested £15,000 in, spending an additional £5,000 on setting up home with Mr Y, leaving her job and re-locating her children on the understanding that Mr Y’s intention was to provide her with financial security by way of a home. Although the house was purchased solely in Mr Y’s name, it had been purchased with the joint intention that they would live “effectively as man and wife”.

The Judge was satisfied that Mr Y had intended to provide Miss X with financial security and that he had communicated his intention to Miss X. Miss X had seen documents prepared on the behalf of Mr Y which provided for her to receive a lump sum and a pension if Mr Y died - which suggested a financial commitment by him to her. Whilst not relating to the property, they assured Miss X of financial security offered by Mr Y.

Throughout the period they lived together, Miss X supported Mr Y in pursuit of his career and he increased his earnings and achieved at least one promotion. Miss Y, who had given up her job to move, completed a 3 year degree and had the benefit of rent-free accommodation.

Taking into consideration the above, the Judge decided Miss X’s interest in the property was £20,000 which he increased to £28,500 after taking into consideration the rate of inflation from 2002.

The decision was upheld by the Court of Appeal who indicated an overall reluctance to interfere with the findings made by a previous Judge who had heard the couple give evidence.

Whilst the case highlights the complexities and uncertainties for unmarried couples within this field of law, there are things you can do to keep yourself protected in the event of a relationship breakdown. For total peace of mind, our family law experts recommend that unmarried couples who reside together should consider entering into a cohabitation agreement to ensure further security and protection in the future.

Whether you’d like more information on cohabitation agreements or you are living without such an agreement but have invested in property that isn’t in your name and would like some expert legal advice, we can help.

Give one of our family law experts a call today on 0113 201 4902 or email family.law@emsleys.co.uk