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Cohabitation Reform: The Scottish Experience

John Fotheringham, of Fyfe Ireland solicitors in Edinburgh, sets out the basics of the Scottish statutory scheme for cohabitation cases and highlights what English practitioners need to know.

image of john fotheringham, fyfe ireland

John Fotheringham, Fyfe Ireland

In March this year, the Ministry of Justice announced that the proposals for a scheme to codify the rights of cohabitants in England & Wales have been shelved. Whatever the political reasons, this decision is very unfortunate for many of the 2.2m cohabitants in England and Wales since they will have to rely on an increasingly complicated and unsatisfactory regime which has not really been resolved by the Court in Stack v Dowden [2007] UKHL 17.

A statutory cohabitation scheme is hardly very outlandish – there has been a statutory scheme in Scotland since 4 May 2006 (see below for relevant statutory provisions) and the scheme is working well. This is something of which an English solicitor will have to be aware in case some day a client should walk into a solicitors' office saying "I've just left Jock" (or "I've just left Morag" as the case may be).

The Scottish system operates on very strict and short time-bars and your new client will have to be advised to seek Scottish legal assistance as soon as possible if his/her statutory rights are to be protected.

Cohabitation can end in one of two main ways – the parties may separate or one of the parties may die. The Scottish statutory system caters for these two eventualities in different ways.

If the parties merely separate ("Get out, never dampen my bath mat again") then either party may seek payment from the other in respect of the economic disadvantage which she has suffered as a result of the cohabitation together with the economic advantage gained by the other party as a result of the cohabitation. The Act frames this rule in a rather complicated way but that is the general gist of it.

There is no minimum period for which the parties have to have lived together before the statutory system applies. The Law Commission favoured a minimum of two years, but that could have unfortunate results. The major economic contributions to a cohabitation are often made at the start – for example, a young woman solicitor who gives up her career and prospects for a year in order to look after home and hearth will find it hard to regain her position in the profession quickly. Apart from that, the contributions to the purchase and furnishing of a home are made at the start of the cohabitation and it would surely be unfair if these contributions had to be ignored just because the cohabitation lasted only 23 months.

The amount of the claim will depend on the extent of the economic disadvantage of the pursuer and although these can accrue very early in the relationship, they can also grow over time. Longer cohabitations are accordingly likely to produce bigger claims

Note, too, that the contributions which have to be taken into account are economic – not narrowly financial. The woman solicitor in the last example may not put much cash into the household but her economic contribution – the huge professional disadvantage which she suffers in the interest of the household – must be assessed by the Court in calculating her financial claim. The Courts are not given a great deal of guidance by the statue in the mathematics of that calculation, and that is probably just as well, bearing in mind the sometimes imponderable losses in terms of career opportunity.

In effect the Court has to carry out a balancing exercise using the economic advantages and disadvantages of both parties resulting from the cohabitation. Rarely will there be a completely clear-cut case in which one party has all the advantages and the other all the disadvantages.

There can be no claim for the transfer of the house in which the couple have cohabited unless it is already in joint names. The claim can only be for money although of course the parties may agree to satisfy the money claim by transfer of property, especially in a case involving children.

The claim on separation (or, strictly speaking, 'cessation of cohabitation otherwise than by death…') must be raised within twelve months of the last date of cohabitation. This may or may not be the same as the last date of living together since cohabitation for statutory purposes is defined as "living together as if husband and wife or as if civil partners. It is clear that cohabitation as if… may cease, in the context of a deteriorating relationship, weeks or even months before one or other of the parties walks out of the door. Accordingly the time-bar may be closer than the client thinks.

If the cohabitation ends in the intestate death of a party then the survivor has only six months from the date of the death in which to lodge a claim in the Sheriff Court. This claim is likely in most circumstances to be very much greater than the claim on mere separation since it can include the home in which the couple had lived even though it was in the name of the deceased alone. The statute actually gives very little guidance to the Scottish courts in establishing just how much the survivor should get as a result of the cohabitation. This is a matter in which the Court has given a very broad and rather unScottish discretion. The claim is limited only by the maximum which a widow can claim on intestacy (currently the house up to £300,000 and £75,000 in cash)

In conclusion English family lawyers should at least be aware of the possibility of a Scottish statutory cohabitation claim for their English clients. The Scottish courts will accept jurisdiction in a statutory cohabitation matter if they would have had jurisdiction in divorce if the parties had been married. This can clearly cover some situations in which the prospect of a Scottish claim may not occur to the client. An English solicitor is unlikely to be sued for a lack of knowledge about Scots family law. Nevertheless English solicitors will be able to serve their clients much better if they are able to point out potential claims (and their time-bars) which may be available in your near-neighbour jurisdiction.

John M Fotheringham WS
Fyfe Ireland LLP
32Charlotte Square
Edinburgh
EH2 4ET
0131 240 5377

Or at Glasgow 0141 222 2216
_________________________________

Family Law (Scotland) Act 2006 ss 25 - 28 (as at implementation)
25 Meaning of "cohabitant" in sections 26 to 29
(1) In sections 26 to 29, "cohabitant" means either member of a couple consisting of—

(a) a man and a woman who are (or were) living together as if they were husband and wife; or
(b) two persons of the same sex who are (or were) living together as if they were civil partners.

(2) In determining for the purposes of any of sections 26 to 29 whether a person ("A") is a cohabitant of another person ("B"), the court shall have regard to—

(a) the length of the period during which A and B have been living together (or lived together);
(b) the nature of their relationship during that period; and
(c) the nature and extent of any financial arrangements subsisting, or which subsisted, during that period.

(3) In subsection (2) and section 28, "court" means Court of Session or sheriff.

26 Rights in certain household goods
(1) Subsection (2) applies where any question arises (whether during or after the cohabitation) as to the respective rights of ownership of cohabitants in any household goods.

(2) It shall be presumed that each cohabitant has a right to an equal share in household goods acquired (other than by gift or succession from a third party) during the period of cohabitation.

(3) The presumption in subsection (2) shall be rebuttable.

(4) In this section, "household goods" means any goods (including decorative or ornamental goods) kept or used at any time during the cohabitation in any residence in which the cohabitants are (or were) cohabiting for their joint domestic purposes; but does not include—

(a) money;
(b) securities;
(c) any motor car, caravan or other road vehicle; or
(d) any domestic animal.

27 Rights in certain money and property
(1) Subsection (2) applies where, in relation to cohabitants, any question arises (whether during or after the cohabitation) as to the right of a cohabitant to—

(a) money derived from any allowance made by either cohabitant for their joint household expenses or for similar purposes; or
(b) any property acquired out of such money.

(2) Subject to any agreement between the cohabitants to the contrary, the money or property shall be treated as belonging to each cohabitant in equal shares.

(3) In this section "property" does not include a residence used by the cohabitants as the sole or main residence in which they live (or lived) together.

28 Financial provision where cohabitation ends otherwise than by death
(1) Subsection (2) applies where cohabitants cease to cohabit otherwise than by reason of the death of one (or both) of them.

(2) On the application of a cohabitant (the "applicant"), the appropriate court may, after having regard to the matters mentioned in subsection (3)—

(a) make an order requiring the other cohabitant (the "defender") to pay a capital sum of an amount specified in the order to the applicant;
(b) make an order requiring the defender to pay such amount as may be specified in the order in respect of any economic burden of caring, after the end of the cohabitation, for a child of whom the cohabitants are the parents;
(c) make such interim order as it thinks fit.

(3) Those matters are—

(a) whether (and, if so, to what extent) the defender has derived economic advantage from contributions made by the applicant; and
(b) whether (and, if so, to what extent) the applicant has suffered economic disadvantage in the interests of—
(i) the defender; or
(ii) any relevant child.

(4) In considering whether to make an order under subsection (2)(a), the appropriate court shall have regard to the matters mentioned in subsections (5) and (6).

(5) The first matter is the extent to which any economic advantage derived by the defender from contributions made by the applicant is offset by any economic disadvantage suffered by the defender in the interests of—

(a) the applicant; or
(b) any relevant child.

(6) The second matter is the extent to which any economic disadvantage suffered by the applicant in the interests of—

(a) the defender; or
(b) any relevant child,

is offset by any economic advantage the applicant has derived from contributions made by the defender.

(7) In making an order under paragraph (a) or (b) of subsection (2), the appropriate court may specify that the amount shall be payable—

(a) on such date as may be specified;
(b) in instalments.

(8) Any application under this section shall be made not later than one year after the day on which the cohabitants cease to cohabit.

(9) In this section—
"appropriate court" means—

(a)where the cohabitants are a man and a woman, the court which would have jurisdiction to hear an action of divorce in relation to them if they were married to each other;
(b)where the cohabitants are of the same sex, the court which would have jurisdiction to hear an action for the dissolution of the civil partnership if they were civil partners of each other;

"child" means a person under 16 years of age;
"contributions" includes indirect and non-financial contributions (and, in particular, any such contribution made by looking after any relevant child or any house in which they cohabited); and
"economic advantage" includes gains in—

(a)capital;
(b)income; and
(c)earning capacity;

and "economic disadvantage" shall be construed accordingly.

(10) For the purposes of this section, a child is "relevant" if the child is—

(a) a child of whom the cohabitants are the parents;
(b) a child who is or was accepted by the cohabitants as a child of the family.