Is it time for change in the law on cohabitation and separation in Scotland?

In Scotland, cohabitants who separate can, in certain circumstances, make claims in relation to household goods and certain money and property and for financial provision on separation.

This access to the legal framework comes via Sections 26 to 28 of the Family Law (Scotland) Act 2006.

Earlier this year the Law Society of Scotland published a paper entitled “Rights of Cohabitants“. Part of a wider review by the Scottish Law Commission into various aspects of family law.

Considering the law relating to cohabitants’ rights is the first phase of this root and branch review of our family law framework.

The Scottish Law Commissioner, Kate Dowdalls QC, and her team asked family law practitioners to share their experiences, and those of their clients (anonymised), of cohabitation claims on separation – specifically in relation to section 28 claims (the rights to seek order for financial provision where the cohabitation ends otherwise than by death).

The Scottish Law Commission hopes to publish a discussion paper early next year, and the issues which the Commission wants to address can be found here.

What is the current situation and experience of cohabitants?

With offices all around the country – in Glasgow, Edinburgh, Inverness, Elgin and Lerwick – we are well placed to provide a good overview and have found that a lot of people simply do not know that cohabitants can have the right to make claims for financial provision on separation.

Yet, more than half of our clients have children, making it all the more important for public awareness to be raised so that cohabitants do know they have the potential to make a claim.

One aspect of the cohabitation framework which has caused difficulty is the need to raise court proceedings within one year of the cessation of the cohabitation, failing which the claim will be time barred. This is a tight timescale, particularly given the emotional fall-out common when a relationship ends. Married couples tend to be much more aware of their rights plus there is no timescale for the raising of a divorce action. The only protection afforded to cohabitants is under the 2006 Act provisions.

In our response to the Law Commission questionnaire we proposed that the time limit, if it needs to remain in place, should be extended to two years. The current one year limit seems unfair and arbitrary. There is no discretion for the court to accept a claim outwith that timescale. Previously, there was sometimes scope to claim under the common law remedy of unjustified enrichment. However, a recent case suggests that will not be possible.

It is a moot point whether there should be a timescale for cohabitants but not for married couples. The cohabitation legislation was put in place in circumstances where there was recognition that cohabitation is not the same as marriage and that many people who cohabit have made a conscious decision not to marry. This means that the law in relation to separated cohabitants is different to divorce law (which latter is set out in the Family Law (Scotland) Act 1985).

As Sheriff Collins QC noted in the recent case of Phillips Jackson –v- Christine Burns “There might be said to be some tension in this approach given that persons who lived together will only be ‘cohabitants’ for the purpose of the legislation if they lived together ‘as if they were husband and wife’.” Unlike for married couples there is no express reference to fairness or reasonableness in deciding whether to make an award under the cohabitation provisions. So, it has become, again to quote Sheriff Collins QC, “something akin to an accounting exercise”. This generally involves looking at parties’ financial positions at the start of their relationship and at the end to see if one or other has sustained economic disadvantage to the other’s advantage from contributions made by the applicant.

There is then a need to consider the offsetting provisions, namely whether economic advantage derived by one party from contributions made by the other is offset by economic disadvantage sustained by the other and whether economic disadvantage suffered by the applicant is offset by economic advantage derived by the applicant.

As you can see, the wording in the legislation is quite complicated. The uncertainty around the validity and quantification of claims has proved problematic and all this makes advising clients much harder.

It is also only possible to ask for a capital sum payment. It is not possible to ask for a property transfer order. This means that the only option for a cohabitant who is a joint owner of a property is to apply to court, in a separate court action which adds to the expense, for an order for sale (even though the cohabitant might actually want to keep the house or might not object to the other party keeping it).

There is also no scope to ask for financial support for a cohabitant (akin to aliment for a spouse).

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Society has moved on since the legislation was enacted and that is something that needs to be addressed. So, we believe a review and reform of the legislation in relation to cohabitation is timely. At Harper Macleod we are proud to be playing a part in that process.