Economic Rights of Unmarried Cohabitants
“Economic Rights of Unmarried Cohabitants,” that’s the subject of today’s ACTEC Trust and Estate Talk.
This is Jean Gordon Carter, an ACTEC Fellow from Raleigh, North Carolina. An increasing number of Americans choose not to marry. The Uniform Law Commission has recognized the importance of having laws concerning the economic rights of unmarried cohabitants. To tell us more about the uniform law, you’ll be hearing today from ACTEC Fellow Turney Berry, of Louisville, Kentucky. Welcome, Turney.
Thanks so much, Jean. This is an interesting project for the exact reason you think – that there are so many cohabiting couples, and they range in age. Six percent of cohabitants as of 2017 – the most recent year for which we’ve got clean data – are over the age of 65, which is interesting. It’s not just the young folks coming out of college or just starting out. So, people range in age. I suspect, by now, that number is even higher.
But the law across the country is really not well developed. In fact, some states still cling to the notion that cohabitation is somehow bad. In part, perhaps, because it involves sexual relations outside of marriage. In part because it is thought to be detrimental to marriage. States just have different perspectives on this. So, what our act is trying to do is really be an enabling act. So, let’s talk a little bit about what we are really trying to do here. (Uniform Laws Commission Cohabitants Economic Remedies Committee and Act)
Who is a cohabitant?
The first thing we have to think about is who is a cohabitant? And we restricted the scope of our act to two individuals who are not, of course, married – at least to each other. We only want to deal, in our act, with folks who are of age of majority or emancipated. We don’t want to get into minors. That’s a sticky issue. And we also are not interested in dealing with a brother and sister who live together or sisters who live together or parent and child, et cetera. So, the way we’ve defined that is to say that our cohabitants have to be people who would be, essentially, eligible to marry.
Then the question is well, who is a cohabitant? Who is one? And there are millions of possible definitions. And sometimes I think, in the last two and a half years, we’ve discussed them all. And where we settled is that folks who live together as a couple are cohabitants. And you’re going to immediately think, well that’s a very imprecise definition. And it is an imprecise definition. We’ve rejected a number of things that could have been there as being too difficult to prove.
For example, do we want folks to have to prove that their economics are intertwined in some way? What does that really mean? Do we want to discuss whether the couple has an intimate or a romantic relationship? Our conclusion is really that courts are not very good at that sort of thing. So that “live together as a couple” is something that we think a court can look at all the facts of the circumstances and make a determination on. We’ll see. Time will show whether we’re right or not on that.
There are many folks who’ve said because of young people, shouldn’t we have a time limit involved in this? In other words, before our act comes into play, shouldn’t there be – you have to be a couple for some X amount of time? With our definition of living together as a couple, we decided that a time limit would be a terrible thing because our intuition is that there are plenty of folks who are not a couple on, let’s say, St. Patrick’s Day. But they will be a couple on July Fourth. But when between St. Patrick’s Day and July Fourth they will actually become living together as a couple could be very difficult to show. And if you’re going to have time limits tied to something, you’ve got to be able to show it clearly. So, we decided to leave that open, really.
What the act then does is say that if you are a cohabitant, that merely being a cohabitant will not be a bar or an impediment to a contract between the cohabitants. So, if I can contract with my neighbor about this or that, I can contract with a cohabitant about this and that. And the only question is well, could I contract with my neighbor about this or that?
And obviously, as we know, certain contracts are not allowed under state law. Certain contracts require certain kinds of formalities and things. We’re trying to preserve all of that. What we really want to do is say merely being a cohabitant is not a bar. We go a little further than that. We say that there shouldn’t be any procedural or substantive limitations or barriers to that sort of thing. So, that’s a contractual piece.
We also want to say that cohabitants may bring equitable claims against one another. Again, just like regular individuals can in the state. So if, for example, I am not a cohabitant with, but let’s say I live in the same apartment complex with someone else and we commute to the same office building. In theory, one of us could own a car and the other one could make payments on the car because we carpool in and out. And, if for some reason something happened there, I didn’t make the car payment or I didn’t maintain the car or do whatever our deal was supposed to be, we might have equitable claims against one another. We don’t want those equitable claims to be hampered, initiated, barred – whatever you want to say – merely because two people are cohabiting. And so, we say that equitable claims are not limited because of the cohabitation.
And then, we do one additional piece there. We say that an equitable claim may be brought in a little more broad a way than just my car payment example. An equitable claim may be brought on account of each member of the party – each cohabitant’s – contributions to the relationship.
And a contribution to the relationship is exactly what you would think. It is a contribution of money or property or services or activities. Efforts could be domestic services, could be paying for this or that. It specifically excludes sexual services. They are not contributions to the relationship for purposes of our act.
But taking care of the other party’s parents, for example. Taking care of children. Providing for the household. All those things are contributions to the relationship. And we want there to be an equitable claim that, at least, can be brought. The value is to be determined – the degree to which claims would cancel out. In other words, two cohabitants bring equal contributions. Well then, assets or whatever they have should be divided equally.
We specifically rejected certain things, like expanding common law marriage. Why? Well, because common law marriage hasn’t done very well. There used to be a lot more states with common law marriage than there are now. We rejected a status based approach of any sort. The American Law Institute has conjured up what some people refer to as “marriage lite” – a domestic partnership type of thing. And we looked at that and we thought that from our point of view, legislatures were not really ready for that and we ought to try this approach first.
So, what we really are doing is we’re looking at a relationship. And a court will look at who has legal title to the assets. And if one of the parties can say, based on contracts, that I have or based on my equitable claims, including my contributions to the relationship, I think I deserve X. Then a court could say, notwithstanding title to certain assets, there could be a property or money that could be awarded to one of the cohabitants.
The most difficult issue, interestingly enough, that we have really is more common than I would have guessed are cohabitants who are married to other people. In other words, one of the cohabitants is married to somebody, but they are cohabiting. And how do you adjudicate between the claims that a cohabitant might have and the claims under state law that a spouse would have?
In divorce, it’s not really terrible because those claims are adjudicated by a court. But in probate, it’s a very interesting issue because, of course, you’ve got an intestate share that if there’s no will of a surviving spouse is entitled to. You have an elective share that a spouse is entitled to. How does that relate to the rights of a cohabitant? And we generally believe that we want the spouse to come out a little bit ahead of the cohabitant; although, there’s a lot of disagreement about what that means.
So, we expect this act to be finalized by the Uniform Law Commission in July of 2021. The issue of spousal claims versus cohabitant claims is not fully resolved, and it may not be fully resolved until the annual meeting of the Uniform Law Commission because it’s a very tricky issue. It involves a lot of policy, and it involves a lot of emotional commitment that folks have to different kinds of relationships.
All in all, we think this is an important act. We think it advances the law and deals with an important social situation. It’s not, I don’t believe, the final act that many of us will see during our lifetimes. It’s an initial effort, and we’ll see what the results are and make a start.
Thank you very much for the opportunity to talk about this in our work today.
Very interesting. Thank you, Turney, for your insights on this new Uniform Law.
This podcast was produced by The American College of Trust and Estate Counsel, ACTEC. Listeners, including professionals, should under no circumstances rely upon this information as a substitute for their own research or for obtaining specific legal or tax advice from their own counsel. The material in this podcast is for information purposes only and is not intended to and should not be treated as legal advice or tax advice. The views expressed are those of speakers as of the date noted and not necessarily those of ACTEC or any speaker’s employer or firm. The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. The entire contents and design of this Podcast, are the property of ACTEC, or used by ACTEC with permission, and are protected under U.S. and international copyright and trademark laws. Except as otherwise provided herein, users of this Podcast may save and use information contained in the Podcast only for personal or other non-commercial, educational purposes. No other use, including, without limitation, reproduction, retransmission or editing, of this Podcast may be made without the prior written permission of The American College of Trust and Estate Counsel.
If you have ideas for a future ACTEC Trust & Estate Talk topic, please contact us at ACTECpodcast@ACTEC.org.
© 2018 – 2022 The American College of Trust and Estate Counsel. All rights reserved.
Latest ACTEC Trust and Estate Talk Podcasts
What You Need to Know About Authenticating Cross-Border Documents and the Importance of Electronic Apostilles (e-APP)
International estate planning experts explain ACTEC’s support of electronic apostilles, e-APPs, and the importance of apostilles to the trusts and estates practice.
Planning for retirement benefits under the SECURE Act is complicated. Hear the top ten recommendations from a trust and estate expert when planning distributions.