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Divorce law blog

How WILL I protect my assets?

06/04/2017   By: Caitlin Jenkins

I have been cohabiting with my partner for years. We have no wills but surely they’ll inherit everything on my death?

What happens when one cohabitee dies?  Our research revealed that 44 per cent of the cohabiting couples surveyed had not made a will.  It is important to know what difference having a will makes because, unlike married couples, cohabiting couples have no right to inherit from each other under the intestacy rules.

If you die without leaving a will, you die “intestate”.  Your estate is then at the mercy of the intestacy rules which dictate who gets your money, property and personal possessions.  There is nothing in the intestacy rules that entitles a surviving cohabitant to automatically receive anything from the deceased cohabitant’s estate.  If you find yourself in this position, your only option is to make a claim to the court and ask the court to provide you with “reasonable maintenance” from the estate.  Undertaking such an ordeal at what is often a traumatic time is best avoided.

The best way to avoid these problems is to make a will.  By making a will, you're able to:

  • say who you want to leave your property, money and other assets to, ensuring your loved ones are financially provided for;
  • protect the value of your estate through sensible inheritance tax planning; and
  • avoid additional complications, heartache and stress for your family after your death.

Rightly or wrongly, the onus is on cohabitees to be proactive and protect their position.  A will represents the most secure way to so.

The one exception to this is jointly owned property, for example the family home.   Many unmarried couples will jointly own their home.  There are two different ways of jointly owning a property:

  • as joint tenants; or
  • as tenants in common.

Only as joint tenants would the surviving cohabitee inherit the deceased cohabitee’s share of the property.   This is because the “right of survivorship” applies to joint tenants.  The deceased’s share automatically passes to the survivor regardless of whether or not there is a will (and regardless of any instructions left in the deceased’s will).  The right of survivorship does not apply to tenants in common.

As tenants in common, the deceased’s share of the property passes in accordance with their will or, if there is no will, under the intestacy rules.  The surviving cohabitee still retains their share in the property which means that they will co-own the property with the deceased’s estate.   There can then be a conflict between the two co-owners – the survivor who wants to stay in the family home and the estate who wants to sell the property to turn their share into cash.

Our survey showed that almost 60 per cent of cohabiting couples were unaware of the rules around jointly owned property on death.   This was particularly alarming given more than 40 per cent owned their homes as joint tenants.  This is one situation where ignorance is not bliss.

Find out more about wills and the rights of cohabiting couples by viewing our Myth of the Common Law Marriage web page or by speaking to the family team here at Mills & Reeve.

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