What Is a Cohabitation Agreement?
A cohabitation agreement is a contract between unmarried partners who live together or intend to live together.
The agreement can regulate the financial and property aspects of the relationship and record what the parties have agreed should happen if they later separate.
Because every couple's financial circumstances are different, the agreement should be drafted around the parties' actual assets, liabilities, contributions and intentions rather than relying on a generic document.
Why Consider a Cohabitation Agreement?
South African law does not simply treat every unmarried couple who lives together as though they were married.
Without clear arrangements, disputes may arise about who owns particular assets, what contributions were intended to achieve, who is responsible for debt and what should happen to jointly acquired property when the relationship ends.
Clarify Who Owns What
Record which assets belong individually to each partner and which property is intended to be jointly owned.
Agree on Household Costs
Set out how rent, bond payments, utilities, groceries and other shared expenses will be dealt with.
Define Financial Responsibility
Record responsibility for personal debts, jointly incurred liabilities and other financial commitments.
Plan for an Exit
Agree in advance how specified assets and financial arrangements will be dealt with if the relationship ends.
What About Property?
Property is one of the most important issues for cohabiting couples to address, particularly where one partner owns the home but both partners contribute financially.
Paying towards household expenses, renovations or even a bond does not necessarily mean that the contributing partner automatically acquires ownership of the property.
If only one partner is the registered owner of immovable property, the other partner should not simply assume that financial contributions automatically create an equal share in that property. The parties should obtain advice and clearly record what their contributions are intended to mean.
What If You Buy a Property Together?
Couples who purchase immovable property together should think beyond the excitement of getting the keys. They should also consider what happens if the relationship later ends.
Record Ownership Shares
Be clear about the respective ownership interests and ensure that the legal documentation reflects the intended arrangement.
Record Financial Contributions
Specify how deposits, bond instalments, rates, levies, insurance and maintenance costs will be shared.
Plan for Improvements
Address significant renovations or improvements and how contributions towards them will be treated.
Agree on an Exit Mechanism
Consider what happens if one partner wants to retain the property, whether a buy-out will be possible, and when the property should instead be sold.
What Can a Cohabitation Agreement Cover?
The agreement can be tailored to the couple's circumstances and may address a wide range of financial and practical matters.
Existing Property
Identify assets that each partner brings into the relationship and confirm how ownership will be treated.
New Purchases
Record how assets acquired during the relationship will be owned and how contributions will be dealt with.
Joint Financial Arrangements
Address joint accounts, savings, investments and the purpose for which shared funds may be used.
Debts
Clarify responsibility for existing and future debts between the parties.
Living Expenses
Record how recurring household expenses will be shared while the parties live together.
Separation Arrangements
Set out how specified jointly owned assets and other agreed financial matters will be dealt with on separation.
What Is a Universal Partnership?
The absence of a written cohabitation agreement does not mean that there can never be financial consequences when an unmarried relationship ends.
South African law recognises the possibility of a universal partnership between cohabiting partners. Such a partnership may arise through an express agreement or, in appropriate circumstances, through a tacit agreement inferred from the parties' conduct.
However, a universal partnership does not arise automatically simply because two people lived together, shared a home or had children together. The party relying on the alleged partnership must establish the legal requirements for its existence.
A long relationship may provide important factual context, but living together for many years does not by itself prove that the parties intended to create a universal partnership.
What Must Be Proven for a Universal Partnership?
The courts consider established partnership principles when determining whether a universal partnership existed.
Contribution
Each party must have brought, or undertaken to bring, something into the partnership. Contributions may take different forms and are not necessarily limited to cash.
Joint Benefit
The partnership must have been carried on for the joint benefit of the parties rather than solely for the benefit of one partner.
Profit or Financial Benefit
The required partnership elements include an object directed towards profit or financial benefit in the legally recognised sense.
An Agreement Must Exist
The partnership may be expressly agreed or inferred from conduct, but the evidence must establish the necessary agreement between the parties.
Litigation about an alleged tacit universal partnership can require detailed evidence about years of financial dealings, contributions and conduct. A properly drafted cohabitation agreement can provide far greater certainty about what the parties actually intended.
Can Cohabiting Partners Agree on Financial Support?
The financial consequences of an unmarried relationship should not simply be assumed to mirror those of marriage.
A cohabitation agreement can regulate contractual financial obligations between the partners, including appropriate provisions dealing with financial support or agreed payments where legally permissible.
The precise wording matters. If financial support after separation is intended, the nature, duration, amount or method of determining that obligation should be considered carefully when the agreement is drafted.
What About Debts?
Cohabiting couples frequently share expenses without clearly deciding who is ultimately responsible for the underlying liability.
A cohabitation agreement can regulate responsibility between the partners for agreed debts and financial obligations. However, an agreement between the partners does not necessarily alter the contractual rights of an outside creditor.
If both partners sign a credit agreement, loan or other contract with a third party, their private cohabitation agreement cannot simply remove the creditor's contractual rights. The external contract and the agreement between the partners must both be considered.
What If You Have Children Together?
A cohabitation agreement can record the parties' broader intentions and financial arrangements, but issues concerning children are governed by the Children's Act and the child's best interests.
Parental responsibilities and rights, care, contact and child maintenance therefore cannot simply be contracted away by the parents.
Care & Contact
The parental responsibilities and rights held by each parent are determined according to the Children's Act and the particular circumstances.
Child Support
Both parents remain responsible for supporting their child according to the applicable legal principles, regardless of whether they are married.
Practical Arrangements
Appropriate arrangements about residence, contact, maintenance, schooling and other parenting issues may be regulated through a parenting plan.
The Child Comes First
Agreements between adults remain subject to the legal protection afforded to children and the child's best interests.
What Happens If One Partner Dies?
Cohabiting couples should consider estate planning separately from the arrangements dealing with the breakdown of their relationship.
A cohabitation agreement can form part of the couple's broader financial planning, but it should not be treated as a substitute for a properly drafted will.
If you want your partner to receive particular assets or benefits when you die, obtain appropriate estate-planning advice and ensure that your will, beneficiary nominations and cohabitation arrangements work together rather than contradicting one another.
How Do You Create a Cohabitation Agreement?
The best time to discuss these arrangements is while the relationship is functioning well, rather than during a separation when every couch, coffee machine and bank transfer has suddenly acquired constitutional significance.
Identify Your Assets and Debts
Each partner should identify relevant property, liabilities, investments and other significant financial interests.
Discuss Your Financial Arrangements
Decide how expenses, assets, debts and future acquisitions are intended to be dealt with.
Plan for Separation
Consider what should happen to jointly owned property, shared accounts and other financial arrangements if the relationship ends.
Have the Agreement Properly Drafted
An attorney can translate the parties' intentions into clear contractual terms and identify issues that may otherwise have been overlooked.
Review Before Signing
Both partners should understand the agreement, disclose relevant information and ensure that the document accurately reflects what has been agreed.
Should the Agreement Be Updated?
A cohabitation agreement drafted at the beginning of a relationship may no longer reflect the couple's circumstances years later.
It is sensible to review the agreement when significant financial or personal changes occur.
You Buy a Home
Purchasing property together or moving into property owned by one partner may justify reviewing the agreement.
You Start a Business
New business interests may materially change the parties' assets, contributions and financial risks.
Your Family Changes
The arrival of children may require broader financial planning and separate consideration of parenting arrangements.
Your Circumstances Change
Significant changes in income, investments, debt or financial dependence may make existing terms outdated.
What Happens If You Separate Without an Agreement?
Separation without a cohabitation agreement does not automatically mean that one partner has no possible legal remedies. However, the outcome cannot simply be determined by applying matrimonial property rules as though the parties had been married.
Ownership of particular assets, contractual rights, jointly owned property and the possible existence of a universal partnership may all require consideration.
Where the parties disagree about what they intended or how their contributions should be treated, resolving the dispute can require extensive evidence and litigation.
After a relationship ends, parties may have very different recollections of what was promised years earlier. A written agreement can substantially reduce disputes about ownership, contributions, liabilities and the parties' original intentions.
Why Use an Attorney?
A useful cohabitation agreement needs to do more than state that each partner will "keep what belongs to them". It should deal with the financial realities of the particular relationship.
Clear Contractual Terms
Ambiguous wording can create the very dispute the agreement was intended to prevent.
Ownership Arrangements
Legal advice can identify the difference between ownership, financial contributions and contractual obligations.
Practical Exit Provisions
A workable agreement should explain how specified financial arrangements will operate when the relationship ends.
Identify What Is Missing
Proper advice can identify issues involving debt, property, businesses, children or estate planning that the parties may not have considered.
The Bottom Line
Choosing not to marry does not mean that couples should avoid planning for the financial consequences of building a life together.
A cohabitation agreement can provide clarity about property, expenses, debts and separation arrangements while the parties are still able to agree on those issues calmly.
A cohabitation agreement is not a prediction that the relationship will fail. It is a way of ensuring that both partners understand what they own, what they are responsible for and what they have agreed.
Cohabitation Agreements
Danel Campbell Attorneys assists unmarried couples with cohabitation agreements tailored to their property, financial arrangements and individual circumstances. We also assist with disputes arising when cohabiting relationships come to an end.
Explore Family Law Services →This article provides general information regarding cohabitation agreements and unmarried partnerships in South Africa and does not constitute legal advice. The legal consequences of a cohabiting relationship, the enforceability and interpretation of an agreement, property rights and any alleged universal partnership depend on the particular facts and circumstances of each matter.