"Trick Or Treat" - Housing Traps For The Unwary The Halloween

Home ownership disputes for unmarried couples

29.10.2007

As the nights close in and Halloween draws near, many of us are getting ready to cautiously open our front doors to young “trick or treaters” eager to provide a scare or surprise this spooky season.

However, for a lot of unmarried couples a real fright awaits much closer to home and actually lies, in the ownership of the property itself.

In recent years there has been a significant rise in the number of couples choosing to live together rather than get married. Understandably, the last thing on a couples’ mind when buying their new home together is the question of the legal title to or ownership of the property.

Family law expert Liz Tait

But, Liz Tait, Family Law Partner at leading national law firm, Irwin Mitchell, warns "This can be a major trap for the unwary and time spent checking out the title in advance is the key to stopping your “dream home” turning into an "Amityville Haunted House".

So what potential horrors lurk in the shadows for the unsuspecting purchaser?

Liz comments "first things first - put bluntly, as the law stands at the moment, there is no such thing as a ‘common law wife or husband’. And whilst it is generally accepted that reform in this area of the law is long overdue, the Government has only just published recommendations aimed at helping to protect cohabiting couples and there are no guarantees when, or even if, these reforms will be introduced."

"What this means in practice is that where the home is bought and registered in one of the couple’s name only then there is no automatic entitlement in law. The other must show that a trust exists in order to establish an interest in the property. This can be done in a variety of ways, for example by direct contribution to the purchase price by payments of the deposit or, by improvement such as the building of a conservatory. A trust can also be established by agreement or understanding between the couple if one of the couple rely on that understanding to their detriment. An example of this might be paying the mortgage or by way of significant contribution to the household bills.

Family law legal advice

Liz continues "where the legal title reflects that the property is in joint names, we have to dig down a little deeper to find out actually what interests the couple may each actually hold in the home. Properties can be held jointly in two different ways, either as tenants in common or beneficial joint tenants. Where the property is held as beneficial joint tenants then one persons' share passes directly to the other automatically on death. Only in exceptional cases will a property held in the names of beneficial joint tenants not be considered to be held equally. This can be a good thing but beware if this is not what you intended. For example, if one of the couple has paid a £50,000 deposit and the other contributed nothing then holding the property as beneficial joint tenants may effectively gift an interest in the deposit monies to the other party. This may be what you wanted to happen but it is worth being sure that what is on the title deeds reflects what you want for the future".

“Another way of holding a property jointly is as tenants in common where each holds an interest in the property entirely independent on the other. Shares can be held unequally but they do not have to be".

The answer to how a couple hold the property can be found at the Land Registry by getting a copy of the entry for the property called 'office copies' but Liz cautions “as with all issues of this nature it is much better to "look before you leap" and discuss this matter with your solicitor in advance of the purchase.

If a relationship breaks down and you wish to make a claim based on arguing that the legal title is not reflective of the true position then this is much harder and more expensive to do than by actually setting up the title correctly in the first place. And remember, unlike married couples any dispute concerning unmarried couples and property centres on the fact that the Court is looking at the intention of the parties and not at fairness.”

Liz concludes "Don’t have nightmares: this area of the law is potentially very complex. Check out the position and your rights by taking specialist legal advice, preferably in advance, and then proceed to enjoy Halloween without living in your own "scary movie".