In a recent landmark decision by five Justices of the Supreme Court, some clarity has been brought to the issue of cohabitee’s rights. Whilst it has always been accepted that the terms of The Family Law (Scotland) Act 2006 did not seek to provide couples, who chose to co-habit rather than to marry or enter into a civil partnership, the same rights to financial provision, the Justices decided that the Inner House of the Court of Session had adopted too narrow an approach in considering what financial provision should be made on the termination of cohabitation. The Justices acknowledged that the main principle in deciding what financial claims a cohabitee may have against a former cohabitee, is one of fairness whilst at the same time acknowledging that cohabitation is a less formal, less structured and more flexible form of relationship than marriage or civil partnership. In the case which the Court was considering, Mr Grant and Miss Gow first met in 2001, became engaged, but separated in 2008. Miss Gow had owned a property in Edinburgh before the relationship and had sold this during the course of her relationship with Mr Grant. The proceeds of sale of her flat were used during the course of the relationship and the couple had lived in Mr Grant’s home for a period.

The terms of Section 28 of The 2006 Family Law Act (“the 2006 Act”) dictates what awards, if any, should be made in the circumstances. The Sheriff at first instance exercised his discretion in concluding that taking all matters into account Miss Gow had suffered a net economic disadvantage as a result of the relationship and that she should be compensated in the amount of £39,500. Mr Grant appealed against this decision to the Inner House and this Appeal was allowed. Miss Gow then took the decision to the highest Civil Court in the land, namely, the Supreme Court, who found in her favour. Lady Hale, in her judgement, acknowledged that the law does not seek to impose upon unmarried couples the same rights and responsibilities which result from marriage or civil partnership but seeks to redress the gains and losses flowing from the relationship.

If nothing else, this decision simply underlines the need for couples who have decided that they do not intend to marry or enter into a civil partnership to consider entering into a Cohabitation Agreement to minimise the potential financial fallout in the event that the relationship ends. In view of the fact that the 2006 Act covers the position in relation to the ending of cohabitation of same sex couples as well as couples of opposite sexes,  this decision has significant ramifications for all couples who make the decision to cohabit and not to marry.

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