What to do with the family home after a couple split up
Who owns the family home? This question is especially relevant if a couple break up. In the case of a married couple, the court can make use of the powers available to it on divorce; it has a degree of flexibility as to how to divide the family's assets. In the case of an unmarried couple, however, the court has no such freedom and must strictly apply the principles of property law.
The title deeds are the starting point. In principle, you are only an owner if your name is on the title. The ownership picture painted by the deeds can, however, be varied or added to by agreement accompanied by detrimental reliance. So someone whose name is not on the title may still own a share in the property. Similarly, if the deeds do not spell out the size of each party's ownership share then the court looks at what has been agreed.
The court will ordinarily give effect to an express agreement between the parties about ownership if this is necessary to fill in details that are missing from the title (such as the size of each party's share). Frequently, however, there is no express agreement. This puts the court in a difficult position.
In the case of unmarried couples, there is no special code that fills this gap. The court has to work with the idea that the couple had a common intention, although recent cases acknowledge that an "intention" to do what is fair and reasonable may need to be imputed to the couple by the court.
When deciding on what has been agreed, the court looks at "the whole course of dealing". It looks at everything the couple said and did from the time the property was acquired that casts some light on their common (if implicit) intention or gives the court some sense as to what fairness demands.
A wide variety of factors might be relevant but it is possible to discern two broad categories of cases. In one type of case, a survey of the couple's financial arrangements suggests that they were engaged in a kind of domestic partnership where risks and rewards would be borne equally. Typically, they will each have accepted liability to pay off the mortgage. They will often have joint bank accounts. The names of both parties may be on the title deeds. Equality of interests is the likely outcome where there has been pooling of assets and liabilities.
In other cases, where there was no such pooling, the court's survey of the whole course of dealing often results in a kind of accounting exercise. While there is no limit to the range of factors the court can consider, the central focus would appear to be on the couple's contributions, especially financial contributions, to the acquisition and improvement of the family home. Other types of contribution, such as those involving household expenses, can also be relevant. Here, each party gets a share proportionate to their contribution.
If the property was acquired as an investment rather than as a family home, this is likely to limit the sorts of contributions taken into account. There may be a stricter focus on contributions to the deposit, purchase price and mortgage payments.
Professor Michael Lower teaches and researches land law in the Faculty of Law at Chinese University