I enjoy my monthly phone in with St Alban’s Radio Verulam because the questions listeners send in really keep my on my toes. This morning was no exception, but sadly time constraints often prevent me from going into too much detail with my answers. So I thought it would be a good idea to do so here. Here is one of the questions I was asked on today’s show:
“My boyfriend is still married. All three of us now have our own houses. What advice can you give me if I was considering buying a house with my boyfriend in future? Can you foresee any problems that might occur if he remains married or if he wants a divorce?”
Since the abolition of legal aid, I suspect that a lot of people who are married and then split up have not yet resolved their financial position together. It’s a complex affair, going to court, and it’s hard to understand what each can claim and also how to settle. In most cases it isn’t a 50/50 split of capital and that’s all. So for many people who can’t or won’t pay legal fees, it can be easier not to bother and let things stay as they are.
Thus there are plenty of married but separated people out there with no financial settlement, entering into new relationships, expecting new partners simply to accept things as they are and invest with them in a new relationship which doesn’t yet include marriage but does include a financial investment of, say, a new property acquired together when there is no legal relationship between them.
In the above case we don’t know what the boyfriend or his wife are worth, what her “reasonable needs” are, how many children there may be and we can’t assess her claims against her husband. Or conversely his against her. That has to be done.
Let’s assume there are two children and a wife on a reasonable income or him helping her to pay the bills to stay in the house. He may live in a modest house which is why he wants his girlfriend to help him move up the ladder again.
At the very least there will be a liability for child support and, depending on both incomes, there may be a need for ongoing spousal support. There may be a need for more capital to be paid by the boyfriend to the wife from the equity in his house to reduce her mortgage. Or it may be decided that the wife stays put in the family home and he won’t get his share until the youngest child finishes school. It’s hard to say without more information.
But why would this impinge on the girlfriend?
She is pure gold for a wife. In a financial divorce case she could get dragged into the proceedings, her finances examined, and her assets used to reduce the boyfriend’s needs but wouldn’t be used directly to fund the girlfriend. Her contribution could be used as a good reason to reduce the boyfriend’s capital pay off from the family house.
If the girlfriend doesn’t care and still buys a house together with the boyfriend she needs to make sure the basis on which it is bought is fully recorded. They can buy as ‘tenants in common’ and in a Trust deed, set out the contributions each has made to the house and how the net proceeds of sale are to be divided so that if they split up she won’t lose out.
In the event of the boyfriend’s death, his share passes as he has left it by will and not automatically to the other, which would be the case if they purchased as joint tenants.
Of course, early death is unlikely but I have been involved in a case where the ex husband bought a property jointly with his new partner, and made no will. They bought the property as joint tenants and the new partner assumed that his share of the property would become hers when he died tragically in an accident. Although it did in law, it was not immune from attack. The ex-wife challenged the estate, which included his half share, on behalf of her two infant children.
He had life insurance which more than covered his liability to pay child support throughout their infancy, so the girlfriend kept his share and her home.
Overall, my view as a family lawyer is that involving yourself with someone who is still married but whose finances are not resolved is foolish. Even when they have been sorted it’s often not a good bet. The most common complaint is not about a house purchase, rather that their income and capital is being used to effectively prop up the finances of their partner who is (as they see it) paying through the nose for the first family. This feeling is felt especially if the first wife doesn’t (or won’t) work and there are children to maintain. There might even be a boyfriend in the background too – who stays with the ex-wife not quite long enough each week to be regarded as cohabiting. It’s a situation built for aggro that won’t go away and it will only get worse if the girlfriend and her married partner then start a family together.
If they hadn’t married and then split, the only liability he would have to her is child support and possibly his share of the equity in their house to be held on trust during the minority of the child. It would then revert back to him.
You have been warned.
It’s not good news to be involved with a person who is married to someone else. Unfortunately, however, the head doesn’t always rule the heart.