The Judgment in the above case was released yesterday (09.11.2011) and restored the original Order made by the County Court which awarded Mrs Jones 90% share of the property and 10% to Mr Kernott. The long-awaited decision in this case makes it clear that, even though the home was registered in the names of both the man and the woman, Judges are permitted to substitute a fairer division such that the split may not necessarily be a 50:50 division.

The Supreme Court had been asked whether the property should be shared 50:50 or predominantly award more to the woman (who paid all of the mortgage for the past 13 years).

In this case, a property was purchased in joint names mid 1980s. The couple split in 1993 after living together in the property for eight years. Mrs Jones continued to pay the mortgage and maintain the house and brought up the couple's two children. Mr Kernott bought another home using a joint insurance policy that the parties cashed in and which was divided equally. Mr Kernott waited until 2006 when the children were grown before making a claim on the property in question, i.e. claiming 50% entitlement. The County Court ruled that Mrs Jones should get 90% and Mr Kernott got 10%. That decision was upheld by the High Court in 2009. In 2010, the Court of Appeal overturned the lower courts' rulings and decided that Mr Kernott was entitled to 50% because the couple owned equal shares when they separated and neither had since done anything to change that situation.

The Supreme Court yesterday overturned the Court of Appeal decision and has reverted back to the original 90:10 split. The presumption of joint beneficial ownership could be rebutted by “evidence” such that the common intention that there was when the property was purchased has come to an end by other events which have happened.

Thus, each case will turn on its own facts.

Is there now a call for legislation to be introduced to reflect the fact that more and more couples are living together as co-owners in an attempt to unscramble what is really a fairly incomprehensible area of the law?

The Judgment makes it even more important that couples who live together have a clear simple Declaration of Trust explaining how they want to own the property and a Living Together Agreement (i.e. Cohabitation Agreement) that shows what their intentions are. If they break up or there is a change in circumstances, then if they want certainty, it would be sensible to go back to their Agreement or Declaration of Trust and make sure that it says what they want it to.
 

Contact John Sherahilo or Chrys Wall for more details.