Complexity in financial provision for cohabitees

8 August 2011

When cohabiting couples separate, it can be extremely stressful for both partners to un-entangle their financial situation. It has been said that the legislation has not appeared clear, with little in the way of case law to clarify matters.
In a recent case involving a cohabiting couple who had separated, the court reversed an earlier decision to award a sum of £39,500 to a woman, Ms Gow, who had lived with her partner, Mr Grant who she had been engaged to for almost five years.
After their relationship ended, Ms Gow claimed to have been disadvantaged by having sold her home to move in with Mr Grant and consequently lost out on the rising value of it during the following years. In cases such as this, the legislation directs the courts to look at whether the defender (Mr Grant) derived economic advantage from contributions made by the applicant, and whether (and, if so, to what extent) the applicant (Ms Gow) has suffered economic disadvantage in the interests of the defender.
The court looked at not just the disadvantage to Ms Gow, but the benefit to her cohabitant. Here arises a difficulty as now, courts may look at the parties’ intention: whether they intended to be giving a benefit to the cohabitant, or if this was simply a natural effect of cohabitation.
Here, Ms Gow and her immediate family had also benefited from the sale of her house; with her son receiving a loan of cash, investment in bonds, and debts paid off. In this case, there was not enough evidence of the benefit being weighted towards Mr Grant, even with some joint living expenses being met by Ms Gow.
Unfortunately for Ms Gow, the award was not allowed. It would appear that those pursuing money from cohabitants will now have to make clear what their financial intention towards their partner was – a difficult and possibly impractical barrier to overcome.
This could make claims for money in cases when cohabitation ends a complex and unpredictable issue and it is worth gaining expert advice to guide you through the potential pitfalls.


If you need advice on cohabitation claims in Scotland, contact Inksters’ Gus Macaulay on 0141 229 0880 or send Gus an e-mail.


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