For separating couples, it can be difficult to come to terms with a breakup and the associated financial implications. This can be especially difficult where it’s a long relationship with a lot of investment, not just time but financial. When unmarried couples separate it can be a shock for some to learn that you don’t have the same rights as a spouse would have. THERE IS NO SUCH THING AS A COMMON LAW SPOUSE!
This situation can leave people with some uncertainty as to their financial future. Unmarried couples cannot make claims against pensions, income (there are other routes you can follow which we will explore later), larger financial provision based on needs and spousal maintenance just to name a few. However, unmarried couples can make claims for a share in a property under the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA).
Under TOLATA you could obtain one or more of the following outcomes:
- An order determining the party’s percentage share of a property.
- An order forcing the sale of land or a property.
- An order enabling one party to regain access to a property when the other party refuses to leave.
- An order enabling third parties, such as parents or grandparents, to recover their financial interest in a property owned by the separating couple.
TOLATA is a great tool, but it has its limits. The Court does not have the same powers as it would with a divorcing couple. TOLATA can be incredibly strict for unmarried couples and restricts the Court in what they can consider in evidence. Typically, the Court will consider what has expressly been agreed between the parties. The Court can take into consideration the parties’ intentions when purchasing the property as well. TOLATA relies heavily on express evidence and Trust law and can be incredibly clear cut.
The Court will start by examining how the property is owned. There are typically three scenarios when considering ownership.
1. Property is owned jointly between the parties and the parties’ shares are defined.
Where the property is owned in joint names and the shares of ownership have been expressly agreed between the parties, the Court will automatically default to the expressed agreement of ownership. Inadvertently, this is usually 50/50, but can depend on the situation. It is very difficult to argue successfully against an express agreement. This can be a difficult pill to swallow, hence it is so important to get the proper legal advice when purchasing a property or when separating or entering into a new relationship.
2. Property is owned in joint names but there is no express agreement as to percentage shares.
The starting point for the Court in this scenario is that if a property is owned in joint names it means that the parties are entitled to an equal share. One party will have to argue that it was not the intention of both parties to hold the property in equal shares. Alternatively, that the parties’ intentions changed during the ownership of the property so the proportion share is no longer 50/50.
There are a number of ways to prove this, for example who contributed more to the property, what was on the original property documents when the purchase occurred. Can it be inferred from one party’s actions that ownership should not be 50/50?
3. Property is owned in your ex’s sole name.
Where one party owns the property in their sole name, the starting point for the Court is that the person who owns the property, owns 100% of it. However, the Court will look at whether the parties agreed that the person who is not the owner would be entitled to a share in the property and the Court can determine that the non-owning party should receive an interest in the property.
The Court decide this by considering 3 factors:
1. Was there are promise made as to ownership?
2. Was the promise relied upon?
3. Did the person relying on the promise suffer a detriment?
This can be very difficult to prove and will all be based on evidence.
Unmarried couples who have children together may be able to make a claim under Schedule 1 of the Children Act 1989. The Court can provide for children whilst they remain under the age of 18 which could include for the transfer of property, payment of lump sums or allow one parent to remain in a property owned by the other during a child's minority.
Both of these are very complicated areas of law and it is essential that you obtain expert legal advice before embarking upon a claim. We also recommend that all cohabiting couples create cohabiting agreements, to avoid going down this legal route.
If you are experiencing a break up and want to know what your rights are, contact Jarmans Solicitors for expert, no-nonsense legal advice.