Private Clients

Asset planning between domestic partners under a right of residence

On the need for cohabitation agreement provisions between domestic partners

The instrument of the partnership agreement offers cohabiting partners the opportunity to regulate their mutual housing arrangements autonomously and according to their individual needs and wishes. Through timely and consensual precautions, provisions can be made in particular for a later separation and disputes can be avoided. This article highlights selected issues in the event of the dissolution of the cohabitation without contractual provision and discusses partnership agreement options that can be made between cohabiting partners in the area of housing law.

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Table of Contents

What is a domestic partnership?

The number of (non-marital) cohabiting partnerships is continuously increasing, and with it, their significance is also steadily growing. Due to the rise in the number of cohabiting partnerships and the associated increase in partners living together in a wide variety of arrangements, various tenancy law issues arise.

The non-marital cohabitation is largely similar to marriage in its external appearance and the underlying factual situation, but differs from marriage in the possibility of dissolution at any time. A cohabitation is deemed to exist when there is a long-term, marriage-like living arrangement consisting of a shared household, financial community, and sexual union, although not all of these characteristics must always be present. Due to the lack of a universally applicable legal definition of a cohabitation or a cohabitant, it must always be examined on a context-specific basis who is to be considered a cohabitant in the specific case.

Why is contractual provision important?

Unlike the legally detailed legal relationships between spouses, which are also pronounced in the area of housing law, the statute contains very few guidelines for regulating housing law relationships between cohabiting partners. It is therefore largely left up to the cohabiting partners themselves to plan their housing arrangements proactively and to make adequate and timely provision, particularly in the event of a separation. A suitable instrument for this would be partnership agreements, which, however, are currently not very widespread in practice in Austria, measured against the number of existing cohabiting relationships.

Therefore, a large number of cohabitating partners also rely on general civil law rules to regulate their housing rights and fail to plan their housing arrangements on a case-by-case basis with foresight regarding the consequences of a potential dissolution of the cohabitation. Without contractual provisions, in the event of a separation of cohabitating partners, the division of property can only fall back on general civil law regulations.

Housing law status of the „housed-in partner“

The respective legal status of a partner in the area of housing law varies greatly depending on the chosen form of cohabitation. Merely entering into a domestic partnership does not create a right of residence; therefore, the partner who is the owner or tenant of the apartment jointly inhabited by the partners could – at least after the dissolution of the domestic partnership – in principle demand the eviction of the apartment at any time, and an „admitted partner“ without a legal title independent of the domestic partnership has no protection against being ordered to leave the apartment.

To create a legal title for the moving-in partner, a sublease in particular appears conceivable and practical. By concluding a sublease agreement between the partners, the moving-in partner acquires legal possession of the rented property, thus giving them the right to file a possessory action—for example, in the event that the property is suddenly made inaccessible by the sole main tenant. At the same/same time, the sole main tenant retains the right to terminate the sublease in the event of the dissolution of the cohabitation, thus striking a certain balance of interests.

Rent vs. Buy – On Issues and Contractual Solutions

partners who share Primary tenant are in an apartment, may face the problem that they cannot simply terminate the tenancy without the consent of the other partner and the consent of the landlord. Therefore, at least an internal agreement should be made in a partnership agreement regarding who will remain in the apartment in the event of a separation and who will internally be responsible for the rent.

Also for partners who condominium owner partner it is advisable to make a partnership agreement regarding the legal consequences of the dissolution of the cohabitation, since the termination of the cohabitation per se has no effect whatsoever on the continuation of the residential property partnership. For example, it should be regulated by contract whether one of the partners is to become the sole owner in the future, or whether the residential property is to be sold in the event of a separation. The amount of the purchase price to be paid for the minority share of the other partner or the distribution key regarding the proceeds of sale in the event of a sale of the residential property should also be fixed by contract. For the duration of the cohabitation, provisions can be made in the partnership agreement by, for example, excluding the action for partition for a certain period of time. Contractual provisions can also be made for the event of the death of one of the owner partners.

life partners, the plain Co-owner property (including the house), are equally dependent on making autonomous private arrangements for the dissolution of their cohabitation. In particular, there is a need for regulation regarding the exact modalities of terminating the co-ownership community and, for example, a determination of who is to be granted the right of continued use and for what period of time.

Conclusion

The structuring of the mutual residential legal relationships is the responsibility of the respective cohabiting partners. Through proactive contractual arrangements tailored to the individual needs and wishes as well as the specific living situation of the cohabiting partners, legal disputes (especially in the event of a separation) can be avoided.

In connection with the drafting of partnership agreements and advising cohabiting partners on the structuring of their residential property arrangements, you have at your disposal Alexandra Rech and Daniel Azem at any time under office@atb.law or by phone at 01 39 12345 available.

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