31st Oct 2014

Looking to cohabit? Be careful what you say

Cohabiting couples may find comfort in a recent Court of Appeal decision – unless, that is, the house you were living in was yours.

In this case the couple had met when they were both about 40. The woman had two children from a previous marriage. The man did not. After a couple of years the man bought a home in his name. It was intended that they would all live in it together.

The woman put no more than £4000-£5000 into that property. She did let go of a local authority house in order move in with her partner, however, and had earlier invested some £15,000 into that property to make it a comfortable home for her and her daughters.

The couple later separated in 2012 and the woman sought an order for half of the value in the property. She was unsuccessful in that claim but the court ordered the she was entitled to a payment of £28,500 on the basis of Proprietary Estoppel.

To succeed in this claim an applicant has to prove the following;

  • That one person – normally the property owner – has made a representation or given an assurance
  • That the other person has relied upon
  • To their detriment
  • And that it would be unconscionable to allow that assurance to be ignored or withdrawn

In this case the property owner said comments such as;

  • “She would always have a home and be secure in this one.”
  • That he was taking on a “long-term commitment to provide her with a secure home”
  • And that he “led her to believe that she would have the sort of security that a wife would have, in terms of accommodation at the house, and income.”

Those comments that were made were found to adequately prove that assurances were made.

As a result the woman relied and acted upon those assurances, forsaking her local authority home that she had invested her modest assets in and contributing another £4000-5000 in the new home.

As a result, once the relationship ended, the woman found that she was denied any rights in the property at all. The courts held that her detriment was to be found in the money and money’s worth that she had earlier forsaken and set about trying to put her in a position that she might have been in if she had never acted upon the assurances that were made;

“…it would be unconscionable for the Defendant to do anything other than to seek to put her back in much the same position as she was before she gave up her own house.”

Interestingly the final point on unconscionability was also disputed and failed. The owner argued that he had met all of the woman’s needs during their time together – and those of her two daughters. His argument – essentially one of “After all that I have done for you…”- fell on deaf ears for one very simple reason.

Proprietary estoppel is a legal concept that is concerned with assurances made and steps taken but always such as they relate to an interest in the property concerned. An attempt to compensate for lost rights or frustrated expectations by exalting the quality of the relationship in other aspects is not a relevant consideration;

“With respect, this misses the point and overlooks the judge’s explicit findings as to the nature of the Appellant’s promise on the strength of which the Respondent gave up her secure home. It focuses on the relationship, thereby losing sight of the nature of the promise and the detrimental reliance. The detriment to the Respondent was not that she embarked upon a relationship with the Appellant but that she abandoned her secure home in which she had invested and invested what little else she had in a home to which she had no legal title.”

So where does this leave cohabiting couples where the property is in only one party’s name?

This remains a complicated and inadequately resolved area of law that desperately requires reform. In the absence of new statutory laws we will continue to see the Judges making decisions that try to bring about a notion of fairness for people who find themselves in positions such as these.

This current case is the latest in a long series of cases where the traditional assumptions are being stretched.

Here we see a homeowner being pulled up by his exhortations to his partner to come and live with him. The warnings are clear for homeowners; be careful to not over promise in your desire for your partner to move in with you. You might find that your palabras de amor end come back to haunt you years later once the relationship is over.

Let us help you

If you are thinking of living together, or thinking of separating and are worried about your respective rights in the home, take expert advice. We, here at Family Law in Partnership are specialist family and divorce lawyers in London. Contact us by email with any questions you have about cohabitation by clicking here or telephone and ask to speak to one of our divorce lawyers on 020 7420 5000.