Cole Law Group Blog
Born right on the cusp of Millennial and Gen Z, I was raised with the impression that fifty percent (50%) of marriages end in divorce. Given that less than inspiring statistic, there is no doubt as to why the younger generations are postponing marriage or dropping the seemingly archaic notion all together. But at what cost? Outside of the tax implications, there are legal dilemmas that arise when you have been living with a significant other and have to divide assets without the protections of a divorce.
How does a divorce protect me?
Although many of us were raised with the idea that divorces are bad, they do allow certain protections for couples that need to separate. In Tennessee, ‘marital property’ is subject to equitable distribution at the time of divorce. In general, all property obtained during a marriage and all income from any increase in value of property obtained prior to the marriage constitutes marital property.[1] However, if you are not married and have no other contract dictating who gets what in the event of a breakup, despite investing in a home for years, you may walk away with nothing.
Does Tennessee have common law marriage?
Short answer: not really.
What is a common law marriage? A common law marriage is a relationship between two people who present themselves as married for a certain period of years. If a court makes a finding that certain state specific factors are met, those people may be considered common law married, despite never having a marriage license.
Tennessee does not recognize common law marriages formed within its own state, but it will recognize common law marriages formed in another state. Currently only Colorado, Iowa, Kansas, Montana, Oklahoma, Rhode Island, South Carolina, Texas, Utah and Washington D.C. will recognize common law marriages.
How can I protect my property without getting married?
Consider drafting, or having a lawyer draft, a cohabitation property agreement. Consider joint land ownership agreements. In essence, if you think you and your partner have a mutual understanding, then write it down. If your partner is not willing to sign an agreement that states what would happen to your shared property if things go south and/or your partner only wants their name on the lease or deed, this could and should be seen as a red flag. They are protecting their interests and are willing to leave you unprotected.
An interesting case to help illustrate this issue is the Tennessee Court of Appeals case Smith v. Riley, where two lovers cohabitated despite not being married.[2] Upon moving in together, the couple opened a joint checking account. After several years, the couple went to a lawyer and drafted an agreement in which Riley granted Smith a one-half undivided interest in three boats, two cars, a tractor, and a motor home. They also drafted a second agreement where Riley also gave Smith a one-half undivided interest in the lease and option to purchase with a right of survivorship in Riley’s remaining one-half interest.
What did Smith give in return? On paper: one dollar ($1.00). In reality, she was making payments on the house, including on the principal and the interest, along with also paying taxes and insurance payments on the property.
When the couple broke up, Riley attempted to give Smith nothing, leaving Smith with no choice but to take Riley to court to divide the property. The Court ultimately awarded Smith the three boats, other personal property, and $33,500.00 for her contributions to the home.
If Smith had not had the agreements in place, as her name was not on the title on any of the property or the lease, the Court’s hands would have been tied, and they would be unable to divide the property. Riley would have been able to leave Smith out in the cold with nothing.
If you are considering living with your partner and combining assets prior to marriage, you should seek the advice of a knowledgeable Nashville divorce attorney. The professionals at Cole Law Group have the knowledge and experience to assist you with any questions you may have about protecting your interests. Please contact us at (615) 490-6020 to request a consultation.
If you would like to learn more about joint land ownership in Tennessee read this article: JOINT LAND OWNERSHIP IN TENNESSEE — Cole Law Group Blog — March 28, 2022 (colelawgrouppc.com)
[1] T.C.A. § 36-4-121
[2] Smith v. Riley, No. E2001-00828-COA-R3-CV, 2002 Tenn. App. LEXIS 65 (Ct. App. Jan. 30, 2002)