Trusts of the Family Home

Question 1

Ownership of the family home

Answer 1

JOINT OWNERSHIP. When two or more people own land, the land is held on trust.

SOLE OQNERSHIP. One partner might be the sole registered proprietor of the family home.

REGIMES DEALING WITH SEPARATING COUPLES:
a) if the couple were married or in a civil partnership and subsequently divorce, the family court are given wide redistribute powers. These wide powers can be used to quantify the beneficial interest in the family home and apply whether or not the couple created an express trust over the home when they purchased it.

b) If the couple were not married, engaged or in a civil partnership (ie they were cohabiting), then their affairs are governed by the ordinary principles of trust law.

Question 2

Express trusts of the family home

Answer 2

If the couple have created an express trust over the family home, then their beneficial interests in the family home are set out in their declaration of trust. To be enforceable, the declaration of trust must be evidenced in signed.
If an express trust has not been created, we need to consider whether an implied trust over the land has arisen by operation in law. Implied trusts do not need to be evidenced in signed writing and therefore potentially arise whether or not the partners have given any thought to how the family home will be owned.

Question 3

Resulting trusts of the family home

Answer 3

If someone contributes money to purchase property in the name of another, a resulting trust will often be presumed that gives that party a beneficial interest commensurate (соразмерный) with the amounts of their contribution.

However, a resulting trust only focuses on contributions to the purchase price that are made contemporaneous (одновременно) with the purchase itself. This has a number of concequences when it comes to purchasing family homes:
a) Only contributions towards the purchase price ccount. The payment of ancillary items - such as conveyancing fees, stamp duty or other bills- does not give rise to a resulting trust.
b) Only contributions made at the time of purchase account. A cash payment towards the deposit (on exchange of contracts) or the completion price gives rise to a resulting trust. If the mortgage is not in your name, but you nevertheless pay off that mortgage after the date of purchase, that will not give to a resulting trust.
c) A resulting trust only recognises monetary contributions.

Question 4

Proprietary estoppel

Answer 4

PE prevents someone from going back on their word in relation to property, when it would be unfair to do so.
There are three key elements to establishing a claim in PE:
a) Assurance, whete the legal owner must have made a representation or created or encouraged an expectation that the claiming party would become entitled to an interest in land. The assurance can either be: active (words) or passive (conduct).
b) Detriment, for example, spending money on refurbishing a home or improving property; working without adequate remuneration; giving up a job and moving to a new area; and looking after someone who is gravely ill.
c) Reliance, where the assurance and detriment are connected to each other. The assurance must cause the claiming party to act to their detriment.

Once the elements of PE have been made out, the court has a discretion over whether a remedy should be awarded and, if so, which type.