Assessing economic disadvantage between cohabitants

Unmarried couples across the UK do not have equal financial claims against each other following separation. A striking case in the Supreme Court issued in the summer of 2012 has highlighted this inconsistency.

Mrs Gow sold her house for £50,000 and moved in with Mr Grant in 2003. His house was worth £200,000. They never married. The relationship ended in 2008. They had lived in his house near to Edinburgh.

In Scotland “cohabitant’s rights” were established by The Family Law (Scotland) Act 2006. Section 28(3)(b) provides for a former cohabitant to claim payment of a capital sum upon separation where that cohabitant “has suffered economic disadvantage in the interests of the defender”, namely, the other cohabitant.

Mrs Gow was awarded £39,500, which was affirmed in the appeal to the Supreme Court. When the cohabitation ended Mrs Gow did not have a home whereas Mr Grant still had a home which had increased in value. Had she retained her own house it would have increased in value. The court’s conclusion was that Mrs Gow should be compensated for that disadvantage. The overriding principle was fairness rather than precise economic calculation. Indeed Mrs Gow had spent some of the sale proceeds in 2003 to repay debt and make a loan to her son. Only a fraction of it was used to towards joint living expenses with Mr Grant. It was not essential for her to establish that her economic disadvantage had resulted in him gaining economic benefit.

Had Mrs Gow and Mrs Grant been living south of the border she would not have been able to make such a claim. Indeed Lady Hale said that there was a real need for a similar remedy in England and Wales. The 2006 Act had achieved a lot for Scottish cohabitants and their children. English and Welsh cohabitants and their children deserved no less.

Donald Wright
dw@propertywright.com

My new skill - as a collaborator

I have just completed a course in collaborative divorce law. Is it the "friendly" way to break up or just a divorce lawyer’s gimmick ? Probably a bit of both and I am a fan.
In the mid 90s, Pauline Tesler became a pioneer in developing collaborative law practice from her law firm in California. There are now hundreds of matrimonial lawyers who are members of the International Academy of Collaborative Professionals.
So what’s the attraction ? To answer this question it is useful to understand the traditional negotiation approach taken by divorce lawyers, which can be summed up as,
- Meet client and write to the other lawyer about the variety of separation issues facing the couple who have just broken up. Await a response.
- Avoid having any meetings with the other side.
- If you do end up having a meeting with the couple present, tell your client firmly that he/she should not speak.
- If progress is slow raise a court action.

In general terms this system works well, but there are many ways to skin a cat. One of the negative features of the traditional approach is that it can lead to too much control by the lawyer. Client input to the process is limited. Progress can be slow if the lawyers are too busy with other cases to respond to letters.

The practice of collaborative law brings a fresh approach,
- From the outset the divorce lawyers and clients sit round a table at a four way meeting. (Skype can be used for international divorce cases).
- They all sign a Participation Agreement to attend regular future meetings, disclose information, behave in a courteous fashion and keep minutes of meetings.
- At all meetings the couple are encouraged to speak up and try to reach agreement on separation issues. The lawyers will guide the process and advise as required.
- If the collaboration fails, the lawyers involved are barred from raising a court action.

So the clients are active participants at regular meetings together with their lawyers. Believe it or not this is innovative in resolving family law disputes.It may not suit every situation as some couples just cannot be in the same room. And some lawyers do not have the energy or nerve to adapt to alternative dispute resolution.

A very welcome development. I am looking forward to my first collaborative case, which is just as likely to be about child contact as it is for financial settlement.

Donald Wright
dw@propertywright.com

DIVORCEUK BLOG LAUNCHED

Welcome to the divorceuk blog, the new blog for the family law service website http://www.divorceuk.com/