PREP TASK 1
Review the contract and write a memo containing the following -
POINTS TO NOTE:
Joint tenants: each owner jointly owns the whole of the asset, rather
than a distinct fractional share.
Tenants in common: each own owns a distinct and separate share in
the property
1. An explanation of the nature and effect of the document
The nature of the agreement is essentially a contract, it will be binding
on the client [the cohabiting couple]
The effect of the document is to regulate the financial arrangement of
the parties during the relationship and provide for what will happen to
the finances on relationship breakdown [and the home?]
i.e. cohabitation agreements are contracts which set out arrangements
for how an unmarried couple are to live together and their rights in the
event of a breakdown of their relationship
2. A list of any amendments you think should be made to the
document
PAGE 204 LPC BUDDY
(a) Avoiding undue influence by following independent legal advice
Is he being intimidated by family/friends/etc?
Independent legal advice add a recital to confirm that they have
both taken independent legal advice
Intention/avoid suggestions of undue influence
The parties should obtain independent legal advice and that they make
full and frank disclosure to each other [or at the very least recite that
they do not want to do this]
If the agreement is unduly favourable to one party [which it is on the
facts] needs to be shown that it was entered into freely or following
independent advice
Independent legal advice [to make as credible/enforceable as possible]
Full & frank disclosure
It is good practice for the parties to provide full and frank disclosure of
their finances in a schedule to the agreement.
Full and frank disclosure from both parties [i.e. reveal all of their
assets]
(b) There is incorrect numbering with respect to the ‘outgoings’
heading.
, It should be numbered 7 and 8
(c) Potentially unfair that Duncan is responsible for all outgoings.
Does this need to be amended so outgoings are shared fairly?
(d) Clause 14 is not binding. Clause 14 details who the children are to
have contact with if the agreement is terminated.
They cannot oust the jurisdiction of the court relating to private law
children matters, which includes where the children should live.
Therefore, this clause should be removed.
(e) Clause 15 is unlikely to affect the overall legality of the agreement.
Clause 15 relates to the division of housework.
Cause 15 detracts from the intention to create legal relationships.
Domestic type arrangements tend to detract from the gravity of the
document. Therefore this clause should be removed
In domestic circumstances there is a presumption that the parties did
not intend to enter into a contract [however, this can be rebutted].
The agreement should not include matters that are too trivial, which
includes division of housework because this will make it more likely
that a court will find that they did not intend to create legal relations
[show that parties intended to create legal relations]
(f) The document should be signed/constituted as a deed.
Not as an agreement to avoid any issues with consideration
It states that it is ‘an agreement’ [and not a deed] + not mention of it
being a deed
Will normally be a deed. This avoids any risk that the agreement is void
for failure of consideration [deeds do not require consideration in the
same way as a normal contract]
i.e. normal contracts require “consideration” — something of value
exchanged between the parties — to be enforceable. If there’s no
consideration, the contract might be considered void. However, deeds
do not require consideration in the same way, so using a deed avoids
the risk of the agreement being invalid simply because one party isn’t
providing anything in return.
such agreements may involve one party making promises or providing
benefits (like sharing property or financial support) without receiving
anything in return — meaning there may be no "consideration" as
required in a standard contract. By executing the agreement as a
deed, the parties avoid the risk that it could be declared void for lack of
consideration, ensuring that the terms of the cohabitation agreement
are legally binding even if the exchange isn’t mutual.
(d) Other docs for credibility?
declaration of trust [declaration of trust if one person is the legal
owner/it protects the other party + gives them an interest if the
property is sold] …holding it as a legal owner on trust for the
beneficiaries & other cohabitants/
, wills
(e) Reflect contributions better
Duncan is providing almost 80% of the deposit and is solely responsible
for the mortgage but they will own it 50/50 as joint tenants.
Should the beneficial ownership in fact reflect their contributions? A
tenancy in common is often preferred by clients entering a second
relationship later in life.
Duncan may want to be able to benefit his children [especially as the
money came from his first marriage]
3. An assessment of the enforceability of the document once
signed
PAGE 203 LPC BUDDY
Sutton V Mischon:
Cohabitation agreements are in principle permissible under English
Law.
However their validity if governed by contract. The agreement must
therefore –
(a) Be legal
(b)Avoid undue influence
To avoid any suggestion of undue influence we would influence that
the parties obtain independent legal advice and that they make full
and frank disclosure to each other or at the very least recite that they
do not want to do this.
(c) Show that the parties intended to create legal relations
To ensure this we would amend the document to include a recital to
confirm that there is such an intention and that the parties have taken
independent legal advice
(d)Contain sufficiently certain obligations
(e) Will normally need to be a deed.
We would amend the document to make sure it is done in the format of
a deed and sign as a deed, and we would call the document a deed
There is no inherent invalidity in a cohabitation contract.
The Law Commission Recommended in Cohabitation: The Financial
Consequences of Relationship Breakdown that the government
legislate to make it clear that cohabitation agreements are NOT
contrary to public policy
Public policy is that it’s unlikely to be followed but now it’s at least
likely to be taken into account
Relying on the Mishcon case there is no inherent invalidity in a
cohabitation agreement and at the very least the agreement is good
evidence of the parties’ intentions at the point in time.
Review the contract and write a memo containing the following -
POINTS TO NOTE:
Joint tenants: each owner jointly owns the whole of the asset, rather
than a distinct fractional share.
Tenants in common: each own owns a distinct and separate share in
the property
1. An explanation of the nature and effect of the document
The nature of the agreement is essentially a contract, it will be binding
on the client [the cohabiting couple]
The effect of the document is to regulate the financial arrangement of
the parties during the relationship and provide for what will happen to
the finances on relationship breakdown [and the home?]
i.e. cohabitation agreements are contracts which set out arrangements
for how an unmarried couple are to live together and their rights in the
event of a breakdown of their relationship
2. A list of any amendments you think should be made to the
document
PAGE 204 LPC BUDDY
(a) Avoiding undue influence by following independent legal advice
Is he being intimidated by family/friends/etc?
Independent legal advice add a recital to confirm that they have
both taken independent legal advice
Intention/avoid suggestions of undue influence
The parties should obtain independent legal advice and that they make
full and frank disclosure to each other [or at the very least recite that
they do not want to do this]
If the agreement is unduly favourable to one party [which it is on the
facts] needs to be shown that it was entered into freely or following
independent advice
Independent legal advice [to make as credible/enforceable as possible]
Full & frank disclosure
It is good practice for the parties to provide full and frank disclosure of
their finances in a schedule to the agreement.
Full and frank disclosure from both parties [i.e. reveal all of their
assets]
(b) There is incorrect numbering with respect to the ‘outgoings’
heading.
, It should be numbered 7 and 8
(c) Potentially unfair that Duncan is responsible for all outgoings.
Does this need to be amended so outgoings are shared fairly?
(d) Clause 14 is not binding. Clause 14 details who the children are to
have contact with if the agreement is terminated.
They cannot oust the jurisdiction of the court relating to private law
children matters, which includes where the children should live.
Therefore, this clause should be removed.
(e) Clause 15 is unlikely to affect the overall legality of the agreement.
Clause 15 relates to the division of housework.
Cause 15 detracts from the intention to create legal relationships.
Domestic type arrangements tend to detract from the gravity of the
document. Therefore this clause should be removed
In domestic circumstances there is a presumption that the parties did
not intend to enter into a contract [however, this can be rebutted].
The agreement should not include matters that are too trivial, which
includes division of housework because this will make it more likely
that a court will find that they did not intend to create legal relations
[show that parties intended to create legal relations]
(f) The document should be signed/constituted as a deed.
Not as an agreement to avoid any issues with consideration
It states that it is ‘an agreement’ [and not a deed] + not mention of it
being a deed
Will normally be a deed. This avoids any risk that the agreement is void
for failure of consideration [deeds do not require consideration in the
same way as a normal contract]
i.e. normal contracts require “consideration” — something of value
exchanged between the parties — to be enforceable. If there’s no
consideration, the contract might be considered void. However, deeds
do not require consideration in the same way, so using a deed avoids
the risk of the agreement being invalid simply because one party isn’t
providing anything in return.
such agreements may involve one party making promises or providing
benefits (like sharing property or financial support) without receiving
anything in return — meaning there may be no "consideration" as
required in a standard contract. By executing the agreement as a
deed, the parties avoid the risk that it could be declared void for lack of
consideration, ensuring that the terms of the cohabitation agreement
are legally binding even if the exchange isn’t mutual.
(d) Other docs for credibility?
declaration of trust [declaration of trust if one person is the legal
owner/it protects the other party + gives them an interest if the
property is sold] …holding it as a legal owner on trust for the
beneficiaries & other cohabitants/
, wills
(e) Reflect contributions better
Duncan is providing almost 80% of the deposit and is solely responsible
for the mortgage but they will own it 50/50 as joint tenants.
Should the beneficial ownership in fact reflect their contributions? A
tenancy in common is often preferred by clients entering a second
relationship later in life.
Duncan may want to be able to benefit his children [especially as the
money came from his first marriage]
3. An assessment of the enforceability of the document once
signed
PAGE 203 LPC BUDDY
Sutton V Mischon:
Cohabitation agreements are in principle permissible under English
Law.
However their validity if governed by contract. The agreement must
therefore –
(a) Be legal
(b)Avoid undue influence
To avoid any suggestion of undue influence we would influence that
the parties obtain independent legal advice and that they make full
and frank disclosure to each other or at the very least recite that they
do not want to do this.
(c) Show that the parties intended to create legal relations
To ensure this we would amend the document to include a recital to
confirm that there is such an intention and that the parties have taken
independent legal advice
(d)Contain sufficiently certain obligations
(e) Will normally need to be a deed.
We would amend the document to make sure it is done in the format of
a deed and sign as a deed, and we would call the document a deed
There is no inherent invalidity in a cohabitation contract.
The Law Commission Recommended in Cohabitation: The Financial
Consequences of Relationship Breakdown that the government
legislate to make it clear that cohabitation agreements are NOT
contrary to public policy
Public policy is that it’s unlikely to be followed but now it’s at least
likely to be taken into account
Relying on the Mishcon case there is no inherent invalidity in a
cohabitation agreement and at the very least the agreement is good
evidence of the parties’ intentions at the point in time.
