What is a Cohabitation Agreement?

Parties who live together may regulate the terms of their cohabitation by entering into a Cohabitation Agreement. A Cohabitation Agreement generally deals with the following:

• Who owns (and owes) what at the time of the agreement, and in what proportions.
• What financial arrangements you have decided to make while you are living together.
• How property, assets and income should be divided if you should separate.

They usually cover the following:

• Property rights.
• Financial provision for the parties.
• Financial provision for children.
• Contents of property.
• Personal property.
• Bank accounts.
• Pensions.
• Debts.
• Children.  

What are the general principles of Cohabitation Agreements?

The general principles set out below should be followed:

• Both parties should receive independent legal advice.
• There should be a financial disclosure setting out both parties’ financial positions.
• Consider whether the agreement would cause significant injustice to either party compared with the award a Court would make.
• There must be no emotional or financial pressure from either party.

What is the effect of a Cohabitation Agreement?

Unlike for married couples there is no particular set of rules that automatically applies if cohabiting couples separate. A Cohabitation Agreement can mean that areas of potential dispute on separation are reduced or eliminated. A Court is more likely to uphold a Cohabitation Agreement if the parties have both received independent legal advice and the terms are reasonable.

When should I review a Cohabitation Agreement?

A Cohabitation Agreement should be reviewed on the birth of any child or if there is a significant change in circumstances.

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Please note the above is for information purposes only and is intended to be a short summary. It should not be treated as a comprehensive guide and should not be acted on without qualified legal advice.