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Lessons to be learned for cohabitation cases in England, says Lady Hale in Supreme Court Scottish case

Scottish remedy ‘both practicable and fair’

Baronness Hale of Richmond, Supreme Court Justice

In Gow v Grant [2012] UKSC 29, a Scottish cohabitation case, heard in the Supreme Court, Baroness Hale has said that lessons can be learned in England and Wales from the practicability and fairness provided by Scottish legislation.

The appeal was concerned with the meaning and effect of section 28 of the Family Law (Scotland) Act 2006 which, for the first time, enables a cohabitant to apply to the court for financial provision where the cohabitation ends otherwise than by the death of one of the parties. The court may make an order for payment by the other cohabitant of a capital sum, having regard to whether that party ("the defender") has derived economic advantage from contributions made by the applicant and whether the applicant has suffered economic disadvantage in the interests of the defender or any child. The court must then have regard to the extent to which any economic advantage derived by one party is offset by economic disadvantage suffered by that party, or economic disadvantage suffered by one party is offset by economic advantage derived by that party.

Lady Hale states in her speech that there are lessons to be learned from this case in England and Wales. There is a need for some such remedy south of the border. Sufficient basis for changing the law has been amply provided by the long-standing judicial calls for reform; by the Law Commission's analysis of the deficiencies in the present law and the injustices which can result; by the demographic trends towards cohabitation and births to cohabiting couples, which are even more marked south of the border than they are in Scotland; and by the widespread belief that cohabiting couples are already protected by something called 'common law marriage' which has never existed in the south [para 50]. The main lesson from this case, as also from the research carried out in Scotland and England to date, is that a remedy such as this is both practicable and fair, focusing on where parties were at the beginning of the relationship and where they are at the end. It does not impose upon unmarried couples the responsibilities of marriage but redresses the gains and losses flowing from their relationship [para 56].

The Appellant, Mrs Gow, met the Respondent, Mr Grant in 2001, when she was about 64 years old and he was about 58. They commenced a relationship, and in about December 2002 Mr Grant asked Mrs Gow to move in with him at his home in Penicuik. Mrs Gow agreed to do so if they became engaged, which they then did. They lived together as husband and wife and engaged in an active social life together until January 2008, when their relationship came to an end. When the parties met Mrs Gow also owned a flat in Edinburgh. After the couple moved in together, Mr Grant strongly encouraged Mrs Gow to sell her property, which she did in June 2003. The sheriff held that there was no evidence that Mrs Gow was forced to sell the flat because she was in financial difficulties. Rather, she had sold the property in the interests of furthering her relationship with Mr Grant. The net proceeds of the sale had been used partly for her own purposes and partly for the couple's living expenses. Mrs Gow continued to live in Mr Grant's home until she obtained rented accommodation in June 2009. The sheriff found that the value in July 2009 of Mrs Grant's former flat was £88,000. The difference between that figure and the price at which the flat was sold in June 2003 was £38,000. The sheriff also heard evidence that during their cohabitation the parties purchased two timeshare weeks in their joint names, each of which cost
£7,000. Mrs Gow paid £1,500 towards the first week, and the whole price of the second week.

The sheriff recognised that the language of section 28 allowed her a discretion to make an order and that a precise calculation of loss, based on specific payments and receipts, did not require to be made. Her conclusion, having regard to the relevant matters, was that Mrs Gow had suffered a net economic disadvantage, and that she should be compensated in the sum of £39,500. Mr Grant's appeal to the Inner House was allowed and the sheriff's award of a capital sum to Mrs Gow was set aside.

The Supreme Court unanimously allowed Mrs Gow's appeal, overturned the decision of the Second Division, and affirmed the sheriff's finding that the Appellant has suffered economic disadvantage in the interests of the Respondent to the extent of £39,500. The leading judgment is given by Lord Hope, with whom Lady Hale, Lord Wilson, Lord Reed and Lord Carnwath agree. A concurring judgment is also given by Lady Hale, with whom Lord Wilson and Lord Carnwath also agree.

The judgment can be read in full here. There is a fuller press summary here.

Steve Kirwan, Chair of Resolution's Cohabitation Committee commented:

"Now that the Scottish legislation has been in place for several years, and the lessons from research are available, we urge the government to revisit this matter, so that cohabitants in England and Wales can receive similar legal protection to their counterparts north of the border."

Resolution is calling for new laws in England and Wales, for couples who have lived together for five years or more – or for less time in cases of exceptional hardship. For cohabiting couples with children, the law would offer protection regardless of how long they have lived together.

Under Resolution's proposals, these couples would have an automatic right to apply for certain financial orders if they separate. If a couple wished to opt out of this provision, they could do so by way of a written agreement. Such a law would prevent injustice by allowing the courts to recognise a cohabiting relationship and decide on an outcome that is fair and reasonable.