How does Cohabitation affect a Divorce Settlement?

Going through a divorce settlement can be an overwhelming process for the family, whereby those involved are seeking answers and security during a time of uncertainty.

Questions often asked by divorcing spouses signing up to spousal maintenance orders in favour of their soon-to-be former spouse may include:

  • “What happens if they cohabit?”
  • “How does cohabitation affect divorce settlements?”
  • “Will I have to continue to pay maintenance in these circumstances?”

We discuss these questions about cohabitation and divorce settlements in detail below.

Cohabitation Before Divorce is Final: Is this a Wise Course to Take?

Cohabitation before divorce is final does not necessarily have bearing on spousal maintenance payments, division of goods, or their rights in a divorce, unless clearly stipulated in your court order.

The idea of paying maintenance for a former spouse even while they cohabit with a new partner can be met with a sense of outrage that a party may have to continue, rather than consideration of the wider implications of the automatic termination of spousal support upon cohabitation. Therefore, one spouse beginning a new relationship may increase the tension between parties and, in turn, make it tougher to arrive at a rational and fair solution to the issues that need to be settled.

The traditional approach under the Matrimonial Causes Act 1973 (MCA 1973) involves treating cohabitation as a factor to bring into consideration when looking at needs and, as such, its impact has always depended on the extent of the former spouse’s cohabitant’s resources.

Cohabitation is to be taken into account but not to be treated as a marriage. Depending on individual circumstances, the financial position of the new partner in the equation may be considered. This means that if the new partner earns a modest income, then their financial situation is unlikely to be reviewed. On the other hand, if the new partner has substantial assets or is a multi-millionaire and one spouse is receiving significant financial support from him or her, then their finances are much more likely to be raised in court. This may affect any tax free spousal maintenance payments they’re currently obtaining.

Furthermore, unlike remarriage, a former spouse or civil partner’s cohabitation after divorce will not automatically bring their maintenance to an end, unless they can be convinced at the time of settlement to sign up to a consent order under which their cohabitation would terminate periodical payments, and much will depend on:

  • The circumstances of all parties (including the cohabitant) at the date of any variation application
  • The approach of the individual district judge hearing the application

Will Cohabitation Before Divorce is Final Affect Arrangements for Children?

If the couple getting divorced have children, the suitability of the new partner having direct involvement in the lives of the children may potentially become an issue and cause the case to become more complex.

Parents separating can be a very unsettling and emotional time for children, so this could mean that a spouse cohabiting with their new partner could negatively impact the relationship with their children.

However, regardless of whether a spouse is cohabiting with a new partner, the courts will still follow the principles set in the Children Act 1989. This means that:

  • The welfare of the child is a top priority
  • It’s in the children’s best interest to have both parents in their lives after a divorce

Significant Cases Showing a Change Towards Cohabitation after Divorce

If one spouse has been cohabiting after divorce for a number of years and a stable relationship is evident, the courts may well take this change in circumstance into account. The courts may stop their maintenance payments entirely, especially if the spouse’s financial needs have been evaluated on the basis that they weren’t cohabiting and were self-supporting.

However, it is important to note that each individual case regarding cohabitation after divorce or cohabitation before divorce is final is unique. Rulings may differ between cases, as demonstrated in the following examples, which is why it is crucial to consult an expert specialising in divorce. If you are concerned about how cohabitation after divorce could impact spousal maintenance payments, get in touch with our legal team.

Here are some case examples regarding cohabitation and divorce:

Atkinson v Atkinson (1988)

In Atkinson v Atkinson (1988), the wife moved in with her cohabitant within months of the settlement under which she had received a capital sum and maintenance.

The husband applied to vary/discharge the maintenance and, at first instance, obtained a 25% reduction based on the projections of what the wife’s cohabitant could generate, income wise. The husband unsuccessfully appealed.

The Court of Appeal were keen to stress that, while the decision not to marry and to simply cohabit was conduct, that it would be inequitable to disregard. Cohabitation was not to be given ‘decisive weight’ nor ‘equated with remarriage’. They found that equating cohabitation with remarriage would, ‘unjustifiably fetter the wife’s freedom to live as she chose post-divorce’, and that any further reduction would force her into poverty.

Atkinson v Atkinson (1995)

Another Mr and Mrs Atkinson (Atkinson v Atkinson, 1995) cohabitation and divorce case came before the court in 1995.

This Mrs Atkinson commended cohabitation around four months after being awarded the former matrimonial home and £30,000 in periodical payments, per annum.

The husband applied to vary and was successful in part – in the first instance, the district judge reduced his maintenance obligation to £18,000 per annum. On appeal, the High Court further reduced this, following fresh evidence as to the upturn of the wife’s cohabitant’s business to £10,000 per annum.

However, Thorpe J reiterated that cohabitation was not to be equated with marriage and that it was merely a factor to take into account, particularly when assessing his needs.

Fleming v Fleming (2003) 

In the Fleming v Fleming (2003) cohabitation and divorce case, the wife applied for an extension to the four-year term on her maintenance order. She had been cohabiting after divorce for more than five years.

At first instance, the judge found that the income of the wife and her cohabitant met their living expenses, but that to terminate periodical payments would cause, or risk causing, substantial financial hardship.

The maintenance was reduced from £1,000 per month to £500 per month, but extended to a joint lives basis. The husband appealed. The Court of Appeal allowed his appeal.

On the question of cohabitation, they commented that the Atkinson (1988) decision remained good law and that the different treatment between remarriage and cohabitation would require parliamentary input if rights for cohabitees were over introduced. The wife in effect failed because she could not show exceptional circumstances to be able to successfully extend the term – not least as her and her cohabitant’s income met their needs.

K v K (2005)

During this K v K (2005) cohabitation and divorce case, it was stated that the Court should bring itself up to date with society, with cohabitation before divorce is final or after being regarded as the same level as remarriage.

It was decided that the wife’s cohabitation after divorce was indeed relevant, and the wife’s maintenance was subsequently varied downwards and capitalised.

The capitalised Duxbury figure was then reduced by 20% to reflect her cohabitation and would have been reduced further had it not been the wife’s entitlement to a share of the husband’s pension that had built up during the marriage.

Placing such a large authority on cohabitation was not completely followed in similar cases after the rulings from K v K (2005). However, in Grey v Grey (2009), it was decided that, although cohabitation does not equate marriage, it is still relevant. After being taken to the Court of Appeal, the case returned to a Judge Singer and it was decided that an assessment of what the new partner should contribute to the wife’s household was required. This was found to be £16,000, which was then deducted from the maintenance required by the husband. The wife was then also required to repay to the husband an equivalent amount to that which the partner should have contributed for the two years leading up to the order. This case clearly demonstrates that cohabitation after divorce can affect maintenance.

So, how does cohabitation affect divorce settlement?

It is clear from the mentioned cases that, although cohabitation after divorce will not bring an end to the obligations of the payor, cohabitation can be taken into account and can affect divorce settlements and maintenance. This is why taking sound advice early from our esteemed family law barristers is of paramount importance.

For more information on spousal support, divorce settlements and issues of cohabitation and divorce do not hesitate to get in touch with our legal team. St Pauls Chambers has a team of dedicated and experienced family law barristers who are passionate about getting the best results for their clients.

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