Are legal rights around cohabitation, financial remedy orders and prenups set to change in 2025?

14 January 2025

5 min read

Family Law, Brabners Personal, Cohabitation, Prenups & postnups

As we enter a new year, there are many areas within family law that are ripe for reform — including around cohabitation, financial remedy orders and prenups.

Here, Hannah Saxe outlines why we may see progress made in 2025 and how this could affect your legal rights.

Rights for cohabitees

Cohabiting families are the fastest growing family type in England and Wales. Despite this fact, many people don’t realise that there’s little legal protection available for cohabitees in the event of a relationship breakdown.

Many still believe in the so-called ‘common law marriage myth’ — the incorrect belief that after a certain amount of time of living together, the law treats cohabitants as if they were married. In reality, the claims available are limited to those for financial provision for children and (in some circumstances) claims about a property. However, the latter involves the application of complex trust and property laws, which often leaves the financially weaker person at a disadvantage. There are links between this and issues such as child poverty and domestic abuse.

Reform has been proposed for many years following recommendations by the Law Commission and the Women and Equalities Committee in its report ‘The Rights of Cohabiting Partners’.

This issue is now to be considered with renewed vigour, as the Government pledged to “strengthen the rights and protections available to women in co-habiting couples” in its election manifesto. The focus has shifted from if reforms will be made to when and what they might involve. This is a huge step in the right direction.

The law could be changed to provide us with a similar system to that used in Australia and New Zealand, where cohabiting couples who meet certain qualifying criteria (such as the length of their relationship and/or if they have children) are given the same rights as married couples.

Alternatively, the law may be changed so that it’s similar to that in Scotland and Ireland, where new legislation was made to give specific rights to cohabiting couples that are different to those available to married couples.

Most commentators agree that a change in the law should apply to everyone so that vulnerable people are protected. There should also be the ability for individuals to ‘opt out’ in recognition of personal autonomy.

Financial remedy orders on divorce or civil partnership dissolution

On 18 December 2024, the Law Commission published a scoping report on the laws governing divorce and the ending of a civil partnership. The Commission concluded that the law needs reform and presented the Government with four potential models. These range from codifying the current case law to introducing default rules to determine the division of assets.

The laws that deal with financial remedy orders are now several decades old — dating back to the Matrimonial Causes Act 1973, which was mirrored in the Civil Partnership Act 2004. The Commission found that the law doesn’t provide a cohesive framework in which couples can expect a fair and sufficiently certain outcome. The wide discretion given to the family court results in uncertainty, which can promote disputes rather than settlements.

While the new report marks a welcome development, the suggestion of four potential models indicates that the road to reform could be long and complex. With an already packed statutory agenda — and with rights for cohabitees most likely to be the priority — it remains to be seen whether there’ll be sufficient parliamentary time for progress to be made any time soon.

Since the Government must issue an interim response to the report within six months and a full response within a year, reforms are unlikely to emerge until 2026 at the earliest.

Wealth protection — prenups & postnups

Nuptial agreements — encompassing both pre-nuptial (prenup) and post-nuptial (postnup) agreements — are designed to outline financial arrangements in the event of a divorce. They’re often used to protect assets that one or both parties bring to a marriage or may be inherited during a marriage.

We’ve recently seen an increase in clients passing down wealth to their children in view of the recent changes to Inheritance Tax rules in the UK. This has resulted in an increase in the number of pre- and post-nuptial agreements being put in place to protect that inherited wealth.

The Law Commission also covered the use of nuptial agreements in its scoping report. At present, such agreements offer the best protection available, although the family court retains a discretion to overturn them if they’re unfair.

It was over a decade ago that the Commission initially recommended that the law be changed so that qualifying nuptial agreements that met certain criteria would be legally binding. We continue to await the Government’s response about this point with interest since these agreements remain so popular.