Selling a property after a relationship breakdown. What you need to know.
25 February 2021 by Guest Author
This week’s Law Society Solicitor Chat looked at going through a relationship breakdown and the complexity that occurs if you share joint assets such as a home. In this blog article, Charlotte Knappett, Ties Bouwmeester, and Lisa O’Boyle from the FJG’s Family Law team have provided some answers to a few frequently asked questions.
What are the different types of home ownership couples may have? What rights to the home does this give each party?
Owned in sole name, joint beneficial tenants, tenants in common in equal shares, tenants in common in unequal shares. If they are married, the rights in relation to the home will depend on what financial settlement is fair having regard to all the financial circumstances with first consideration in meeting the children’s needs and considering the s.25 MCA. If they are unmarried, if the home is owned in sole name there is a presumption that the legal owner owns 100% unless the partner can prove they have acquired a beneficial interest, as joint tenants the strong presumption is that each own 50%, as tenants in common the ownership is determined by the declaration of trust. Parties may agree a different ownership. If there is disagreement as to whether the home should be sold, an unmarried joint owner has a right to apply for sale but, if there are minor children who live in the home, the court may delay the sale until their majority depending on the circumstances.
What is an ‘occupational order’ and how can it impact separating couples selling a home?
An occupation order is relevant when there is domestic abuse to exclude the perpetrator of abuse from the home or set rules to enable the occupation of the home to be shared. It can also allow the return of a person who has been forcibly ousted by the other without court order. It is a short-term order usually lasting no more than 6 months.
Is it best to sell a home before or after a divorce or civil partnership dissolution is finalised?
It is usually best to wait to sell the home until a financial settlement dealing with all assets is agreed, set out in a consent order, and approved by the court. However, it depends on an individual’s particular circumstances for example whether, until a financial settlement is reached, they are able to afford the outgoings on the home. They are best to seek legal advice.
If the home is in one party’s name but the other party has made financial contributions, are they entitled to any equity of the home?
If they are married, yes regardless of the contributions the family home is a matrimonial asset which will be considered along with all other financial circumstances. A fair financial settlement for married couples on divorce is one that, so far as possible, meets both parties needs with first consideration of the children’s needs. Contributions are factors in s.25 MCA which is taken into account but “needs” take priority. If they are unmarried, contributions may be relevant to demonstrate that the other party has acquired a beneficial interest in the family home, for example, if there was an agreement or understanding that such contributions would mean the other party would acquire an interest in the property which the other party relied on to their detriment.
If separating partners can’t reach an agreement when dealing with equity shares of a house, how can a Solicitor help?
A Solicitor can assist in discussing the options available that can be taken, in order to reach agreement and avoid Court proceedings. In relation to married couples, a Solicitor can explain the considerations the Court would have when dealing with the family home in financial proceedings and the likely outcome. For unmarried couples, a Solicitor can explain the legal position the courts would take and assess whether the circumstances give rise to successfully disputing their interest in the house.
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