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23.09.20

The myth of common law marriage

Family law practitioner Laura Clews discusses common misconceptions and looks at how things are done differently in New Zealand.

Executive Summary

  • Unlike England & Wales, other commonwealth countries such as New Zealand and Australia have embraced the notion that you can acquire property rights through a long term relationship – even if you don’t get married. These rights have existed in those countries for decades.
  • The myth of the “common law marriage” persists in England & Wales, with many couples wrongly assuming that they have acquired rights by co-habiting for years. Rather, the notion of acquiring property rights through a relationship is done via marriage or the registration of a civil partnership.
  • There are pros and cons to both systems. In New Zealand you acquire property rights without taking a formal step. This has been argued to be unfair, as if you are in a serious relationship for over three years, you can acquire an interest in property, and this can lead to significant disputes where people have “found” themselves in qualifying relationships without realising. However, with the English system, regardless of the length of the relationship, such relationship property rights are not accrued, which can lead to financial inequities on the breakdown of a relationship, or the death of one of the parties.

The persisting myth of the common law marriage

Having moved to the United Kingdom after practising as a matrimonial property lawyer in New Zealand (or a ‘relationship property’ lawyer as it’s known there) for a number of years, I was shocked by the lack of legal recognition for ‘common law marriages’. When I say common law marriage, I mean a long term committed relationship where the couple are living together in the nature of a marriage. You sometimes hear people say that they won’t be getting married as it’s ‘just a piece of paper’, which, in a legal sense, is somewhat true in New Zealand, but not the case here.

In New Zealand, if you are in a ‘de facto relationship’ of longer than three years, you have a legal entitlement to half of the ‘relationship property’. The legal entitlement to property division following the breakdown of a relationship or marriage can be found under one Act (the Property (Relationship) Act 1976) and the entitlement to maintenance orders is under another (the Family Proceedings Act 1980). These entitlements are the same whether you or not you are married, in the civil partnership, or in a qualifying de facto relationship.

This, however, is completely different to the situation here. The Matrimonial Causes Act 1973 only comes into play where a couple is legally married, and the Civil Partnership Act 2004 applies where a couple has their relationship registered.  This is not to say that unregistered couples here will have no property entitlements, but the basis of these rights will not stem from the relationship and the roles played during that relationship. Accordingly, unmarried couples may find themselves in a position where they are not protected, and if they wish to pursue property entitlements then they may have to pursue claims in land law and equity, which can be complex and expensive. The inclusion of de facto couples into the New Zealand relationship property system streamlines the process in the event of a separation. Of course, this does not come without its disadvantages, which is discussed further below.

What is a common law marriage / de facto relationship?

A de facto relationship, under New Zealand law, is a relationship between two people of any gender that live together as a couple. There are many factors when considering whether a relationship is de facto, such as financial interdependence, the performance of household duties, the degree of mutual commitment to a shared life, and many other factors. Essentially, it means that if a relationship is similar to that of a marriage, it could well be a de facto relationship. In the United Kingdom, however, there is no legal recognition of a de facto relationship when it comes to matrimonial property.

In 1976 the Matrimonial Property Act came into force in New Zealand, giving property protection to married couples. In 2001, that Act was substantially amended so as to offer protection to all de facto couples, and the Act was accordingly renamed. This is what gives the courts in New Zealand the majority of their power to divide the relationship property amongst partners who have decided to end their relationship (or upon death of one of the partners). It was at this point that lawyers in New Zealand started to talk about “relationship property” rather than “matrimonial property”. Essentially, it means that if you are in a de facto relationship for at least three years, you have the same protections to property as you would if you were married.  New Zealand’s neighbour, Australia, has similar provisions, though the change came in earlier, and relationships generally qualify if they are longer than two years (with some exceptions).

What difference does it make?

Here in England & Wales, if you are married (or in a civil partnership), if the marriage breaks down, the parties will have certain protections:

  • The parties will, as a starting point, each be entitled to 50% of the matrimonial property (subject to their respective needs).
  • The parties will be able to apply for various financial relief, including for maintenance orders.
  • If married, the family home will be considered a special asset, and regardless of who is on the legal title, the court is able to alter the ownership.

However, if you are not married or in a civil partnership, the situation is not so straightforward. You cannot turn to the Matrimonial Causes Act or Civil Partnership Act for protection. You will not be able to apply for spousal maintenance, and you will not have any entitlement to relationship property – rather the way things are legally owned will have more significance and usually determine your property entitlement.

This can create a fairly inequitable result. Let’s take a situation of a committed relationship, where one party gave up on their career progression in order to be the primary caregiver for the couple’s children, the other has therefore been provided with the support to build up a booming business with a high turnover. The couple and their children now live in a property they have lived in for a year, owned by one of them. If, after 20 years, the couple separate, their situation in New Zealand and England & Wales would be quite different:

  • Family home: In New Zealand, even though only one party is on the legal title, the other party would have a 50% entitlement to the property and would have the right to apply for an occupation order. In this case, the party who has cared for the children could remain in the family home with the children, causing the least disruption to the family. In the United Kingdom, there would be no automatic right to seek the value of 50% of the family home, although you may be able to apply for an occupation order depending on the circumstances.

In New Zealand, the party who is not on the title could lodge a notice that would essentially stop the other party from selling or encumbering the property. In England & Wales, this is something that only married couples or registered civil partners can do on the basis of the property being the ‘family home’. The party not on the title would be vulnerable to sale.

  • Other property: In New Zealand, any property acquired for the use and enjoyment of the parties, or obtained in contemplation of the relationship would be “relationship property” and capable of division between the parties. For example, if one party purchased a yacht from their salary during the relationship, this would be property to which both parties have an entitlement. In the England & Wales, however, in the same couple the other would not necessarily have an interest in that boat.
  • Maintenance: In New Zealand, there would be a right to apply for maintenance. In England & Wales, as this couple did not marry or register as a civil partnership, there is no right to seek maintenance. Of course, there are separate rules in respect of child support.
  • In the event of separation by death of a party: In New Zealand, if one of the parties dies, the surviving partner will have an automatic right to relationship property, whether or not the deceased had a will (and regardless of the terms of that will). In the United Kingdom, the surviving partner’s rights will depend entirely on whether there the deceased had a will, and whether they can some kind of claim to the property under either the Inheritance (Provision for Family and Dependants) Act 1975 or can make a claim under a trust of land.

Are there any advantages to the UK system?

There are many who would argue that yes there are advantages. Some argue that it is better than parties have to make a conscious decision, such as marriage or registration, to create shared property entitlements by virtue of the relationship. In New Zealand, you are required to “opt out” of the relationship property sharing legislation, requiring significant legal assistance when contemplating a qualifying de facto relationship (which is, presumably, at a time when things are going well). Further, it has been argued that the rules so far as they apply in New Zealand are unfair, and the law in New Zealand is currently under review and due for a significant overhaul.

While the common law marriage myth remains in England and Wales, it is likely to do more harm as many people will continue to be living under the illusion that a marriage is ‘just a bit of paper’, without adequately planning for the event of separation or death of one party.

 

To arrange a preliminary consultation with our family law and divorce solicitors, or to find out how we can support you, please send us an emailcomplete our online enquiry form or call us on 020 3918 7880.


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Legal Disclaimer

Articles are intended as an introduction to the topic and do not constitute legal advice.


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