Wealth Warning! Co-owning Cohabitees beware

11 Nov 2011

A Supreme Court judgment on the tricky issue of cohabitants' property rights is due to be released on 9 November.

In Jones v Kernott, the chap left the home some 12 years before he brought his claim, leaving his ex-partner to maintain the mortgage. The courts decided his share was 50%, regardless of his disappearance and lack of financial upkeep of the property. It was not the court's role to impose a retrospectively "fair" outcome when a couple had chosen to own as joint tenants.

The Supreme Court is being asked to reconsider that ; the result will be a judgment which lawyers and the courts have to rely upon as vital authority in future disputes about property between unmarried couples (until, perhaps, a government brave enough decides to give unmarried couples better legal rights).

I recently had to break bad news to a new client who had paid three times as much into a property co-owned with her partner as he had. The bad news was that despite her bigger contribution, they had chosen to own the property as "joint tenants" – eg 50/50.  The chances of her retrospectively undoing that arrangement via the courts is almost nil – and extremely expensive, to boot.

Family lawyers find themselves breaking this bad news time and time again. It's very simple ; when you aren't married, your property rights are interpreted in accordance with what you said on the title deeds, in most cases.

This is what tends to happen.Whe a relationship is going well and a house is being purchased, people tend to get swept along in the day to day excitement and pressure. They may not want to deal with the prospect of what would happen if they split up or who is going to pay what. A rather cavalier towards the detail can take over.

The problem with that is that when a relationship breaks down and you don't have a divorce court to approach for help, you may look back on how you choose to own the property and regret it. Your name might not be on the title at all – or your bigger contribution has not been recognised by you owning a bigger percentage than your partner. It is easy to own a house in unequal shares – you just instruct your conveyancer to purchase the house as "tenants in common" and specify the percentage split.

Can you afford to be cavalier about your property rights?