Partners often choose to live in a common law relationship, instead of getting married. So, what is the best way to sort out finances when cohabiting couples separate?
As a rule, common law couples who separate have fewer rights than those who get divorced or dissolve a civil partnership.
But, there are several ways to make a breakup less complex. You would need to assess your own situation and then choose how best to handle the separation.
A break up is always less problematic if you can agree how to divide your assets. For most, that means money, property, and personal possessions.
There is always a formal legal process to go through in a divorce or a dissolution. But, cohabiting couples who live together can avoid using a solicitor when they part.
Even so, there may be a valid reason for taking legal advice or using mediation. A mediator is a an impartial third party that may help you reach agreement.
It would be best to get some legal representation if you and your ex-partner cannot reach agreements on:
Handling a common law separation varies from case to case, but it usually requires choosing between:
Note: The legal costs of arguing with an ex-partner through a solicitor can be expensive (especially if it goes to court).
Sorting out finances when cohabiting couples separate is not always a straightforward process. Even so, following these steps should make the parting a little easier:
Note: Drawing up a written agreement helps both ex-partners stick to the plan. Having a checklist can reduce any confusion after you have separated (see below).
It can be a complicated task for couples to agree on splitting up finances. Or, you may agree on some monetary items but fail to reach agreement on others. Using an impartial third party may help to broker an agreement (e.g. a mediator).
In most cases, you are going to need professional legal advice or the services of a solicitor if one if the ex-partners:
Things start to get a bit messy if the ex-partner refuses to negotiate is ignores legal rights in United Kingdom. In this case, you may have no choice but to go to court and make a claim against them.
You might qualify to claim a 'beneficial interest' in the home (or other property). It could apply if the ex-partner owns it and you had an agreement (or expectation) that you would get a share of its value if you broke up.
You may be eligible to make a claim against the ex-partner if you have been 'economically disadvantaged'. Put in simple terms, it means you are worse off 'financially'. A similar situation may also apply if the ex-partner became 'economically advantaged' because of the relationship.
Note: You would need to bring a claim within 12 months of breaking up. As a rule, you can only make a claim for a lump sum (not ongoing payments).
Making a claim against an ex-partner differs in Northern Ireland. If you moved into your ex-partner's property you might get a return of money that you paid towards the mortgage.
The rules on taking action through court systems are complex and can be costly. It would be wise to discuss the issue with a solicitor specialising in disputes between cohabiting couples who are breaking up.
Sorting Out Finances after Cohabitation and Separation in the United Kingdom