From The Business of Life section of How You Can Avoid Legal Land Mines by Joseph S. Lyles (2003)
Regardless of your views on the morality of living with someone, there are legal land mines in your path if you live with someone without the legal status of marriage. The biggest problem with such a relationship is presented when it falls apart. Who gets what property when you split up? Will your partner be reasonable?
Jan lived with a man for about two years. During that time thy opened a bar, and she worked in it without pay for a year. She helped renovate the building before the business even opened. When the business started running smoothly, Jan’s significant other ended the relationship. That’s when Jan found out how weak her legal position was as a live-in.
Jan did not have the title to the house where they lived, and her name was not on the lease of the building where the bar operated. She wasn’t even listed as an owner on either title of the two vehicles they drove. Jan was unmarried and therefore could not file a divorce action and demand her fair share of the marital property. Without a marriage, there was no marital property to divide, and there was no paper trail to document her contributions to the business venture.
While there were some legal actions I, as Jan’s lawyer, could take on her behalf, they were not as effective as a family court action.
The Lesson: If you really want to live with someone without the legal benefits of the institution of marriage, document who owns what and make sure to keep track of your contributions to any business ventures that you and your signifiant other start.
In addition, if you do not intend to be married and you live with someone, be careful not to create a common-law marriage. In South Carolina, for example, you become husband and wife by operation of the common law (judge-made law, not statutory law) if you hold yourself out to the community as husband and wife. Contrary to popular opinion, the length of time you live together is not the deciding factor in a common-law marriage. The courts look at evidence, such as filing a joint tax return or signing a lease as husband and wife. The danger of common-law marriage is that one of the parties could be awarded both property and alimony in a divorce proceeding.