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Court reaches decision on former co-habitees' property dispute
Wed 09 Nov 2011
A court has reached a decision in a case that could have implications for co-habitees in England, Wales and Northern Ireland.
Patricia Jones and Leonard Kernott lived together at a property in Essex for eight years until they separated in 1993.
The couple had purchased the house together, but Mrs Jones continued living there after the split and paid the mortgage by herself for 13 years.
However, a dispute arose when the Court of Appeal ruled that Mr Kernott was entitled to a 50 per cent share of the property.
Mrs Jones took her grievances to the Supreme Court, which had to decide whether her former partner was entitled to half of the asset or a much smaller share.
The court ruled in her favour, awarding Mr Kernott ten per cent of the house's value.
Lord Kerr, the judge in the case, described the split as a "fair one between the parties".
Mr Kernott has said he will not challenge the ruling.
Tim Snaith, a solicitor at Winckworth Sherwood, commented: "What happens to property on the breakdown of co-habitation is a complex and uncertain area of law and the Supreme Court's ruling has served to demonstrate this.
"The ruling should be regarded as a cautionary tale for cohabiting couples that have bought their property in joint names. It is now clear that in the event that there is no express declaration as to how the couple intend to hold the property, on separation the court is able to decide their respective shares. In doing so the court will have the discretion to review the intentions of the parties and apply fairness to redistribute their equitable share in the property.
"In light of the above, we would advise that it is essential that couples who purchase property in their joint names record their intentions in an express declaration of trust and also have drawn up for them a co-habitation agreement. If there are any changes in circumstances in the future, then these documents should be reviewed at that time; this will ensure the parties' intentions are still correctly reflected.
"Putting in place these simple documents and maintaining them should provide clarity and certainty in the event of separation. It will also avoid the huge costs of asking the courts to determine the matter, which would usually be borne by the parties to the dispute.
"The Winckworth Sherwood private client team has the expertise necessary to advise cohabitees on the purchase of their new property and every aspect of living together, including whether a cohabitation agreement would be appropriate. With such an agreement, properly drafted, cases like this one could be avoided."
