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Property problems when cohabiting couples part

Another case illustrating once again how problematic life can be when cohabiting couples split up has had a bumpy ride through the courts.

The number of cohabiting couples in the UK is currently at an all-time high of 3.2 million and most still believe they are protected by the same legal rights as married couples.

However, this is not the case. Currently the law does not recognise cohabitants and they have very limited protection on separation and death, despite many being in long-term relationships and having children together, although more protection is available where children are involved.

The case of Barnes v Phillips 2015

This case stemmed from the relationship breakdown of a co-habiting couple with two children who had originally bought a family home as a joint property in equal shares.

But it culminated in the judge deciding that the woman should have 85 per cent of the beneficial interest in the family home and the man just 15 per cent. The man appealed but it was dismissed.

The couple, who started a relationship in 1983, purchased a property in 1996 for £135,000 using a £25,000 deposit and with the balance funded by a mortgage. The property was held in joint names as tenants in common in equal shares. The man paid the mortgage and some bills, the woman paid the remainder of the bills. There were major works carried out to the property to which both contributed.

In 2005 they re-mortgaged the property and at that time the property was valued at £350,000.  They borrowed the sum of £145,000 from another lender to repay the amount outstanding on the original mortgage of £79,000 and the balance was used to pay off the man’s debts in his sole name.

The relationship got into difficulties soon after 2005 and the couple separated.  The man moved out and only paid the mortgage for eight months.  The woman thereafter was left responsible for the mortgage, bills and the care of the children.

By 2014 the man wanted his share of the property. No agreement could be reached and by the time the judge came to making a decision the property was taken to be valued at £497,500 and the mortgage outstanding £113,328.

The Judge accepted that when the property was purchased it was intended to be set up as a joint home and held equally.  There was no evidence or agreement between the parties that their original intention as to how the property was to be held had changed.  Despite this finding the Judge decided that the court would impute their intention on the basis of what was a fair division and decided to give 85% to the woman and 15% to the man.

Despite this case, it does not automatically follow that even if there is an express declaration of a co-ownership of property, that one party can argue to get more than the other party.

Each case is looked at on its own merits. In Barnes v Phillips, the fact that the man had stopped paying the mortgage as well as child maintenance and had taken out a large loan, allowed the court to use its wide discretion to decide the woman should get significantly more than her former partner.

Need advice …

If you are in the process of separating from your partner it is important that you seek legal advice as soon as possible, as the longer you leave it the more uncertain the outcome could be down the line. Try to negotiate a settlement through a solicitor and get a separation agreement in place – this would be a far more cost effective option.

Contact Lucia Mills, co-habitation specialist, for a free initial appointment.

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