Caroline Garnham finds that making a will requires more consideration than simply who gets the loot
IN 2006, 24 per cent of men aged under 60 and 25 per cent of women aged under 60 were cohabiting in Great Britain; this is approximately double what it was twenty years ago. In 2007, it was estimated that 2.25 million couples were cohabiting, which is projected to rise to 3.7 million in 2031! Cohabitants are also the people least likely to have a will.
Only 17 per cent of cohabitants have made a will, despite the fact that when a cohabitant dies, the survivor has no rights against the estate of his or her partner. If, however, they had married, the survivor would have considerable rights whether or not their spouse had left a will or not.
This does not mean that cohabitants have no remedy at all if they are not provided for. They can claim under the Inheritance (Provision for Family and Dependants) Act 1975, but this is not without its difficulties and expense. If there are children involved, not only does the surviving cohabitant need legal representation, but each child also needs to be separately represented. The financial costs are therefore likely to be heavy, which, when added to the emotional costs at a time of bereavement, is for many an unattractive option.
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Furthermore, you can only claim under the Inheritance (Provision for Family and Dependants) Act 1975 if the deceased died ‘domiciled’ in the UK. Domicile is a legal concept based on the country which you continue to treat as your emotional home, regardless of how long you may have lived in the UK.
There are many people living in the UK who have their emotional home elsewhere and claim to be UK-resident but non-UK-domiciled for tax purposes. This prerequisite for giving a claimant the right to claim under the Inheritance (Provision for Family and Dependants) Act 1975 has been said to lead to some ‘absurd and unjust’ results. It is already possible in many jurisdictions for a person who is habitually resident in England, or who is a British citizen, to elect that for the purposes of their succession, English succession law should apply.
However, in so doing, under the existing rule, a cohabitee or indeed any other dependant who is not married, or even a spouse for whom he or she has specifically not provided in his or her will, can leave the dependant out of all inheritance, regardless of how long the relationship has been and how many children they have who may suffer.
OF COURSE, THERE are varying degrees of commitment between cohabiting couples. Under existing rules only those couples who live as if they were married would be able to claim under the Inheritance (Provision for Family and Dependants) Act 1975. This denies relief for the many couples who have an intimate and co-dependent life with another in a joint household but for whatever reason have decided not to live as if they were man and wife.
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There are other concerns with the law as it is at present. When a couple get married their marriage invalidates their existing will, but when a couple start to cohabit any wills they may have continue to be valid. The earlier wills may make bequests and legacies to people for whom they no longer care.
Where a person dies without a will, their estate is distributed according to the intestacy rules. Where a person dies leaving a spouse and children, the surviving spouse receives a statutory legacy of £250,000, all the personal chattels and a life interest in half of anything else that remains. If, however, he or she dies leaving no children but surviving parents or siblings, then the surviving spouse receives all the personal chattels, a statutory legacy of £450,000 and half of anything that remains outright.
A Law Commission report published on 29 October 2009 is suggesting that a cohabitee should be treated as a spouse for the purposes of these intestacy rules. It also suggests that the definition of a cohabiting relationship should go beyond the marriage analogy. The report is also proposing that any claim under the Inheritance (Provision for Family and Dependants) Act 1975 should be extended to all permanent residents of the UK, and not just those who are UK-domiciled.
If you feel strongly about any of the issues raised here, you can add your voice to the debate by email to propertyandtrust@lawcommission.gsi.gov.uk. The period of consultation closes on 28 February 2010, and the results will be considered with a view to proposing new legislation in August 2011.
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