We Love Each Other and Who Owns What Doesn’t Matter – Oh, Yes It Does

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Whilst love blossoms between cohabiting couples, questions as to who owns what may not seem to matter very much. As a High Court ruling recently reviewed by Stuart Barton showed, however, any lack of clarity in that respect can store up serious trouble for the future.

The case concerned a couple who bought and sold numerous properties during the many years they spent together. The last property was placed in the wife’s sole name. After the relationship ended in acrimony, the woman moved out, leaving the man and their two sons in occupation. She subsequently launched proceedings against them with a view to obtaining vacant possession of the property.

Her claim was, however, rejected by a judge, who noted a history of properties being transferred and re-transferred between the couple and members of their extended families. In those circumstances, the property had been registered in the woman’s sole name without giving the matter any significant thought.

Although she held legal title to the property, the judge found that it was 100 per cent beneficially owned by the man and their two sons. He declared that she held the property on trust for them and ordered her to transfer it into their names. He did so after finding that she had contributed nothing to the property’s purchase price and that the man had made all repayments on the mortgage.

Ruling on her challenge to that outcome, the Court noted that it was at first blush surprising that the property’s legal owner had been found to have no beneficial interest in it. The woman had pointed out that the practical effect of the judge’s ruling was that she left a long-term relationship with nothing save a continuing liability under the mortgage.

Dismissing her appeal, however, the Court rejected arguments that she had suffered an obvious injustice. Her challenge to the judge’s factual findings could not succeed and he was entitled to conclude that there was no positive agreement of common intention that the property would be hers alone. She had put her case on an all or nothing basis and it could not be said that the judge was plainly wrong to find that she had no beneficial interest in the property.

If you need help in dealing with the legal and financial consequences of a relationship break-up, contact us today.

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