Making a financial claim more than a year after cohabitation has come to an end

The rights of former cohabiting partners who have been left out of pocket to make claims were recognised  for the first time in 2006, but in a much more restricted way than those who were married – unlike divorce cases, where there is no time limit, court papers had to be lodged and served no later than 12 months after the relationship came to an end, or they would be ‘out of time.’

The rules do not allow the court to extend the timescale to take account of the fact that the split may have been a traumatic one, or that promises to repay money had been made by one side but then not delivered upon. No matter the sum at stake or the degree of unfairness, claims have been rejected because the action should have been brought earlier.

But an appeal to the highest court authority in Scotland has now resulted in an exception being allowed to the general rule being allowed where it can be shown that one side in the relationship has been ‘unjustly enriched’ by being made better off not through their own efforts, but through their former partner’s financial contributions.

Failing to Contribute

The case of Pert v McCafferty went from the Sheriff Court in Paisley, via the Sheriff Appeal Court to the Inner House of the Court of Session in Edinburgh, where it was heard by five judges.

Ms Pert and Mr McCafferty had begun living together in 2004 and split up in 2012. When they began cohabiting, they each owned a flat and he sold his and moved in with her. Although he spent some money on her flat, she claimed he stopped working and contributing to the household. She sold the flat in 2008 and the proceeds went into a house.

They agreed to put the house in joint names, but at the same time, he said that if they split up that he would not be looking for anything from her and would sign the house over to her. He made no claim after he moved out four years later, but the house was not transferred into her sole name at that point either.

However, when she was made bankrupt in 2015, and the house had to be sold, he was given half of the value in the property, while the rest was used to pay off her debts, and nothing was left for Ms Pert.

The court that first heard the case had applied the usual rule and said, no matter what the other side had done, that she was simply too late to do anything about it. But a ‘bench of five’ in Edinburgh, led by the Lord President, Scotland’s most senior judge, have ruled that an alternative means of pursing a claim can be open where one side seeks financial ‘recompense’ due to the way in which the other side have acted. 

More Generous, but not Unlimited

However at the same time, the court made it clear that this is not a remedy that is open-ended either – in the case of Ms Pert, she had failed to transfer the house into her sole name for more than five years, or to bring a court action about that aspect of the case. So, although she won the argument on principle, she was still not able to recover any funds.

Although ultimately of no consolation to her, what the case by Ms Pert has done is create a further opportunity for redress for those who have come out of a cohabiting relationship financially disadvantaged, but who have failed to take legal advice right away.

A Word of Warning

However, it must be stressed that this is an exception to the general rule – it’s therefore only to be used in extreme circumstances because the court won’t grant it lightly. The best way to bring a claim is to do so within a year – otherwise, you immediately start off on the back-foot, and it’s going to cost you more time, energy and money to pursue.

Another way to minimize the risk of having to go to court at all is to have a form of ‘pre-nup’ – an agreement at the start of a cohabiting relationship that is binding on both parties, which deals with how assets will be divided in the event of a split.

These can be extremely important where one partner in a relationship has far greater wealth than the other or is more successful in terms of career, etc during the relationship. But they can also save much stress and grief.

Further Advice

Family Lawyers at Livingstone Brown appear regularly in cohabitants’ claims in the Sheriff Court, and also appear in the Sheriff Appeal Court and Court of Session. They also advise on pre-nuptial agreements to protect assets.

We are currently meeting with clients by virtual means – a video appointment or call back can be arranged though telephone number 0141 429 8166 or complete our online contact form. All calls are confidential.