There have been some concerns in recent years regarding the notion of “equitable” rights over property. That is, the claim that one party holds a property “on trust” for the other party due to an alleged promise that the property would one day be passed on. This issue has been raised particularly where one party has been allowed to live in a house (and undertake renovations etc), with the often argued expectation that the house would one day be theirs.
In the recent case of Wheeldon , the wife in a family law dispute sought a declaration that the husband’s parents held a property on trust for the husband. Following this the wife also sought orders that the property be transferred to the husband and a half share be transferred to the wife.
The wife claimed that a month before the marriage, the husband’s father told the couple that they could live at the property if they paid its rates. They lived there for 26 years and raised two children there. The wife argued that the property was held in trust because they were encouraged that the property was a gift.
In taking into account the husband’s parents denials of any conversations that may have promised a gift of property, Fowler J rejected the wife’s claims and found that the husband and wife had been “given permission to occupy the property and no more.”
This case should act as a reminder to anyone entering into an arrangement for the occupation of a home to ensure that the terms of the occupation are well defined and preferably documented. The legal owner of the house should be very wary about anything that is said or alluded to, which may encourage the occupier to believe the property will be theirs. Similarly, the occupier of a home that may be of the belief the property will be theirs should be cautious with any money they spend on improving the property on the (mis)understanding that the property will pass to them.
Should you require advice in relation to the ownership of property or what constitutes the assets of a marriage, at Everingham Solomons we have the experience and expertise to assist you because Helping You is Our Business.
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