Landmark court ruling could see break-up payments for unmarried couples

Landmark ruling could lead to 'cohabitation agreements'. Picture: Ian Rutherford
Landmark ruling could lead to 'cohabitation agreements'. Picture: Ian Rutherford
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A LANDMARK Supreme Court ruling, in which a man has been ordered to pay his former partner compensation after they separated, could open the doors for thousands of claims from unmarried couples who split up, a family lawyer has claimed.

• Supreme Court ruling could see unmarried couples given rights to claim for compensation

• Landmark move could lead to ‘cohabitation agreements’

In yesterday’s judgment, the Supreme Court ruled that Angus Grant should pay Jessamine Gow £39,500 after the cohabiting pensioners’ relationship ended.

The right to compensation for unmarried couples became available under section 8 of the Family Law (Scotland) Act 2006, but had not been tested in the Supreme Court until yesterday.

Although the Supreme Court justices, led by Scottish judge Lord Hope, stressed that the ruling does not put cohabiting couples on the same legal footing as married ones, it does create a precedent that could allow unmarried couples to seek financial compensation similar to that available to divorcing couples, but without the assumption of an equal division of assets.

Last night, a family law expert warned that it could affect thousands of couples and lead to a rush for “cohabitation agreements” – a kind of pre-nuptial for the unmarried – from people planning to move in together.

Mr Grant and Ms Gow’s case was heard by Supreme Court judges in London, after the Court of Session in Edinburgh overturned an earlier sheriff court ruling that Mr Grant should pay Ms Gow compensation after they separated.

The couple met in 2001, when Mr Grant was 58 and Ms Gow was 64. They embarked on a relationship and the following year he asked her to move into his house in Penicuik. She agreed, if they got engaged, which they did.

In 2003, Ms Gow sold her flat in Edinburgh, after being encouraged to do so by Mr Grant. They lived together until 2008, when they separated.

Most of the compensation refers to the value the flat would have gone up by had she not sold it. The court heard the proceeds were used “partly for her own purposes and partly for their living expenses”.

In particular, the couple bought two timeshare agreements for £7,000, with Ms Gow paying the entire cost of one and contributing £1,500 to the other.

The judges ruled Mr Grant should repay the £1,500, as well as the money Ms Gow lost on the flat, in compensation.

Yesterday, at the home the couple used to share, Mr Grant said: “I am disappointed by the decision, but I do not want to make any further comment while I consider the judgment with my legal representatives.”

In their statement of reasons, the judges stressed it did not put cohabiting couples and married couples who split up on the same footing.

The statement said: “That would be to impose a regime of property sharing, and in some cases continuing financial support, on couples who might well have opted for cohabitation to avoid such consequences.

“But it is sufficiently clear from the background to the enactment of section 28 that the underlying principle is one of fairness.

“The section is designed to enable the court to correct imbalances arising out of a non-commercial relationship, where parties are quite likely to have made contributions or sacrifices without counting the cost or bargaining for a return.”

The court heard that when a £6,000 investment held by Mrs Gow matured in 2006, she spent £2,000 on paintings, two of which she gave to Mr Grant, and £1,000 on a holiday.

But the couple ran up debts while enjoying a lavish lifestyle.

The ruling will have implications for Scottish couples, with family law specialist John Fotheringham predicting around 1,000 a year could be affected.

However, the court has been accused of going too far in meddling in relationships.

Margo MacDonald, MSP, said: “The law here has intruded into the area of relationships, rather than legal obligations.

“The law should always see that legal obligations are adhered to, but should not dabble in relationships because it can never know the whole truth.

“It should be about things like looking after children, and who should pay for the house, not about money used on holidays.”

Meanwhile, Robert Wright, professor of economics at Strathclyde University, said: “It will make people rethink cohabitation, rethink marriage. It might lead to people waiting longer, so we could see less cohabitation, less marriage and less fertility.”