Property (Separation) Agreements
Parties to a relationship are covered by the provisions of the Property (Relationships) Act 1976 provided they are in a qualifying relationship. This Act provides broadly that all relationship property will be divided equally. In addition there are circumstances where the increases in value of separate property will be shared.
However parties can choose to make their own rules about how they will share their property in the event their relationship ends. These agreements can be entered into at the start of the relationship or during the relationship. Agreements entered into at the end of the relationship are called "separation" agreements.
To be binding all agreements must be in writing and each party must have a lawyer from a different firm certify that their client fully understands the agreement. Usually one lawyer will draft the agreement and act for one of the parties, the other lawyer will give the second party independent advice on the agreement. There must be proper consideration given to the agreements and they need to be entered into freely, without duress. There must also be full and honest disclosure of the assets owned by both parties.
Agreements can deal with all of the assets owned by both parties at the date of the agreement or those that might be aquired in the future. They can also just deal with one or two specific assets and leave others to be shared in accordance with the general provisions of the law.
A property agreement is an invaluable tool to allow a couple to determine exactly what is fair in the event that their relationship ends. Remember, sometimes the relationship ends by the unexpected death of one party and a battle then begins betweeen the survivor and the inlaws.
The time to talk about a property agreement to properly record how you wish your assets to be shared is when you are still talking to one another.