Adult relationships and the law -Week

7 Cohabitation - the law

Roadmap
Please click here to view the roadmap for the week....

Intended Learning Outcomes this week:

1. Know and understand the law relating to the financial consequences of a cohabiting couple
separating

2. Apply this knowledge to factual scenarios

3. Critically analyse two leading cases and use that analysis in critical argument

This week:

1. Lecture

2. Reading and activities you must complete

3. Workshop
Lecture

Please access the Powerpoint presentation on Moodle.

Reading and activities you must complete before the workshop

1. Set textbook: Gilmore & Glennon, Hayes & Williams’ Family Law: pp 287-325 (up to, but not
including section 2.4 on proprietary estoppel). Please note - the concepts of trust law for
cohabiting couples are complex. Use the preparatory reading to gain an overview of this
area, but please do not worry about understanding it all. We will discuss and clarify issues
within the workshop this week and in week 8.

2. Cases:

Read the cases of Stack v Dowden [2007] UKHL 17 and Jones v Kernott [2011] UKSC 53. Complete
case analysis grids in advance of the workshop and bring these to the workshop session for
discussion. (Grids available on Moodle)

Aims of workshops

The focus of the workshop this week is the law surrounding the division of property when unmarried
cohabiting couples separate. We will apply the law within practical examples and consider the
potential legal vulnerabilities that these couples face.

Skills being developed

• Application

• Critical reading and thinking

Workshop

1. Introduction
-no statutory framework for definition of this – have to look in equity and trusts
-becoming more prevalent because less people will want to get married so more people will
be co-habiting, role of women changing, economics, house prices are changing so houses are
now assets of value so will be split depending on how much you have contributed
-beneficial ownership when you share a property?
-joint tenants – you own it together ?
-resulting trust u and partner but in his name and u contribute will then give u a share
-if u contribute to mortgage or rent then this is a constructive trust – you must show 2 things
for this, 1st common intention, intend for it to be a joint property but never was made. Must
contribute to property, Lloyds bank v rosset 1991 said you must contribute in some way to
the property. 2nd is
-express- set out who owns what
-constructive trust…
– proprietary estoppel, it would be wrong to recognise an interest? Can’t use matrimonial
causes act so u would use TOLATA act for a s.14
-for children use -Schedule 1 Children Act. Problem with this schedule is may impact partner
when children leave home, its finances for children not partner.

2. Activity 1 - Group discussion (10 min)

3. Activity 2 - Scenarios (30 min)

4. Activity 3 - Case analysis - Stack v Dowden (20 min)

5. Activity 4- Case analysis - Jones v Kernott (20 min)

6. Any questions?

Activity 1 - What are the key mechanisms for recognising the property rights of cohabiting
couples?
 Activity 2 - Scenarios

1.        Rob and Helen have been together for 15 years. They have never married or formed a civil
partnership as Rob’s parents divorced when he was very young, and he has a fear of commitment.
They do not have any children. Both are in their mid-30s.

Helen moved into Rob’s house that he owns in his sole name 10 years ago and has paid for food, and
items of furniture as well as giving Rob and amount to cover bills per month.

Rob has paid the mortgage and their finances were not mingled.

Their relationship is breaking down and they have decided to separate.

What should happen to Rob’s house?

nothing its his house, she hasn’t contributed even though bought food and furniture, never told
her she has a share. No detrimental reliance, so she could not apply ro the court for a sale, cant
use trusted land act or matrimonial act?

Does Helen have any claim under a beneficial interest and is she able to establish an interest in the
property?

Can Helen apply to the Court for a sale of the property?

 
  

2.        Steve and Paul have been together for 30 years. They have 3 adopted children, one of whom is
under aged 18 and who lives at home. They are not married nor in a civil partnership. They
purchased the family home 25 years ago, but this was put into Paul’s sole name as at the time Steve
was a student and did not have sufficient income for mortgage purposes. He did, however,
contribute £30,000 towards the deposit which was from an inheritance from his grandmother.

Paul said to Steve at the time not to worry as the house was really both of theirs and upon that
assurance, Steve paid his inheritance monies to assist with the purchase.

In addition, during the relationship, both pooled their income so that the mortgage and bills were
paid out of a joint account.

Their relationship has ended, and Paul is refusing to discuss matters concerning finances.

Do you think that Steve has a beneficial interest in the property?

its pauls property, so first thing I need to do looking at contrsuctive trust is the common intention.
In this instance it is supposed to be joint property but he was student so didn’t. secondly he has
paid towards the deposit so this gives him aspect of trust. They have pulled all resources going
forward and mortgage was paid out of joint account.

What steps can he take if he has?

the application he can make to the court is to give steve a share of the house, so he will look for
application to sale under trustee act. Or negotiate a settlement, give him portion of the equity.
-First have to establish interest in property then
-secodnly to quantify percent of house he has, or how much money he should get from sale or
being bought out legislation used is TOLATA act, schedule 1 children act.

What is the legislation would he apply under should he be able to do so?

 
3.        Tess and William bought a house in joint names approx. 4 years ago. They are not married or in
a civil partnership. They do not have any children, At the time of the purchase, Tess paid approx.
£200,000 and William paid £10,000. They did not prepare any trust documentation at the time of
purchase reflecting that disparity in contribution. During their relationship, Tess used her salary to
pay towards the mortgage and William used his salary for the utility bills and car loans.

The parties did not have joint account, so all financial matters were kept separate.,

They have agreed to separate, and William is seeking a sale of 50% of the net sale proceeds. Tess
thinks that she should get a greater share as her contribution to the purchase was greater.

How do you think the court would deal with this case in terms of the initial disparity in
contribution?

jointly owned property, no expressed trust not set out any equality of shares. So presumption of
ownership for beneficial interest is equal share, unless said otherwise, but contribution is clearly
not equal.
What might the court be able to do? -Stack v Dowden – they will look at whole course of
relationship taking their conduct into account and decide whether it should be 50/50. Tess would
show common intention to intention to share, they didn’t pull their resources so never intedned to
be equal.

Do you think that Tess should get more than 50%?

Yes
 4.        Peter and Janet were in a relationship for 5 years. They did not marry or form a civil
partnership. They have 2 children. Janet used £5,000 from a sale of her previous property to
purchase the family home which they registered as joint tenants with no declaration of trust as to
unequal contributions. Peter only lived at the property for 1 year before the parties separated. After
separation, Janet paid the mortgage without any contribution for Peter who also did not pay child
maintenance for the children. Peter has remarried and buys a new property with his new wife. 15
years later after his second marriage has broken down Peter needs funds to rehouse and seeks a sale
of his and Janet’s property arguing that as the property is registered in joint names and that he is
entitled to a 50% share

What do you think that the Court would do is this case?

common intention in this case is janet paid in more. He lived in the property for 1 year, post
separation he contributed nothing, then married again and bought property for his wife. Jones v
kernott – presumption that it can be displaced – infer this from conduct of Peter

Would Peter be able to obtain 50% of any equity in the property?

  No, because common intention shifted of equal share and because of his conduct he will receive
around 10% - jones v kernott
 5.        Tony and Margaret have lived together for 20 years. Margaret has formed the view from
speaking to friends that she is Tony’s “common law wife”. She moved into Tony’s house and does not
contribute towards the mortgage or bills. She does, however, spend £10,000 on a new kitchen for the
property. They have no children

They are now separating, and Margaret is claiming that her home improvement has increased the
value of the property and that she now has a beneficial interest in the property.

Do you think that she can claim an interest in the property?

firstly there’s no such thing as a common law wife, it is in Tony’s sole name. doesn’t say if it was
bought prior to relationship, just says she moved into it. No common intention. She paid for kitchen
so this may give her – Lloyds bank v rosset – this case said renovation doesn’t mean beneficial
interest
stack v dowden said about house renovation – improvement that add significant improvement would
be a constructive trust

What if Tony had told her that if she paid for home improvements, he would transfer into joint
names but due to a mix up at his solicitor's office, that did not happen?
If he didn’t then no detrimental reliance,
if advising her say she contributed but legal position is weak

Activity 3 - Stack v Dowden case analysis

Using the case analysis grid that you have prepared for the session this week discuss in groups the
following:

1. What were the facts in this case?

2. What are the legal issues?

3.        How useful is this judgment in providing clarity to the law in this area?
 4. What does this case demonstrate about the powers of the highest court, and does it
demonstrate the limits of judicial intervention?

Activity 4 - Jones v Kernott case analysis

Using the case analysis grid that you have prepared for the session this week discuss in groups the
following:

1. What were the facts in this case?

2. What were the legal issues?

3. How did this case develop the law following the case of Stack v Dowden?