Cohabitation & Universal Partnership

Cohabitation

Cohabitation, which has also been referred to as “living together” or “common law marriage”, is not recognised as a legal relationship by South African law. The assumption that if a couple live together for an extended period of time a common law marriage comes into existence, is incorrect.  The reality is that couples that live together do not have the same legal rights as married couples as there is no law that regulates the rights and duties of cohabitants towards each other.

For example, a cohabitant does not have an automatic right to maintenance from his or her partner. Therefore, a cohabitant cannot claim maintenance from their partner on termination of the cohabitation relationship or from their partner’s deceased estate upon the death of a partner. Similarly, when a cohabitant dies without a valid will, their partner has no right to inherit in accordance with intestate succession.

Everyone is different and no two couples or their lifestyles are the same. One or both of you may have children from other relationships. You and your partner may have come together much later in life, bringing your different individual wealth or assets with you. Whatever your situation is, there are certain steps you can take at the outset and things you should try to agree on with your partner in order to avoid a great deal of unpleasantness and cost if the relationship breaks down or one of you dies or becomes seriously ill.

We are often asked the question “Do I need a cohabitation agreement?” from people in similar situations as described above. The simple answer is “Yes you do”.

It is becoming more and more common for partners in a cohabitation relationship to enter into cohabitation agreements. The cohabitation agreement (also known as a cohabitation contract or domestic partnership agreement) records the arrangements between the couple who live together. The agreement will usually contain arrangements regarding finances during the existence of the cohabitation relationship and the division of property, goods and assets upon its termination.

Cohabitation agreements are legally binding between couples. Therefore, should one partner refuse to act in accordance with the agreement, the other partner can approach a court for assistance. In most cases, a court will enforce the agreement.

Cohabitation agreements generally cover:

• The ownership of property
• The ownership of personal belongings and furniture
• Who will contribute to finances, mortgage/rent, household expenses etc
• They may also include an express provision for the payment of maintenance upon termination of the cohabitation relationship.

Universal Partnership

Although legally cohabitants do not have the same rights as spouses in a marriage, our courts have on occasion come to the assistance of cohabitants by deciding that a universal partnership exists between them.

A universal partnership will come into existence when cohabiting parties act like partners in all material respects without explicitly entering into a partnership agreement. Put simply, it is an agreement between two parties (whether tacit or otherwise) to put all their assets in a communal pot and that, should the partnership terminate at a later stage, that the assets accumulated during the partnership should be distributed equally between the parties.

In the case of a claim by one party on termination of a universal partnership, the court will usually award a share of the assets acquired during the relationship to each party.

To prove the existence of a universal partnership is very difficult. Certain requirements must be met before a universal partnership can come into existence. These include:

1. the aim of the partnership must be to make a profit;
2. both parties must contribute to the enterprise;
3. the partnership must operate for the benefit of both parties; and
4. the contract between the parties must be legitimate.

In order to succeed with a claim of universal partnership, the claimant must prove that:

1. both partners contributed to a specific joint venture in some form or other through their labour, capital or skill;
2. the venture was conducted for the benefit of both partners;
3. the venture was conducted for profit; and
4. a universal partnership came into existence.