A recent case shows that not having the right sort of evidence of the intention to share ownership of a property can lead to what seems, on the face of it, to be a very unfair result for one partner.
Sharon James lived with Peter Thomas, an agricultural contractor. She worked in his business, but received no payment. All the income from the business went into an account in Mr Thomas’s name and all the couple’s expenses were paid from this account, including the mortgage on the cottage they shared. The property had been purchased by Mr Thomas before he and Ms James started living together and was in his name. Ms James had carried out improvements to the cottage which had enhanced its value.
The business was reconstituted as a partnership in 1999 and the bank account was made a joint account in 2002. However, in 2004, after 15 years together, the couple separated and shortly afterwards the partnership was dissolved. Ms James claimed that she had a beneficial interest in the cottage, arguing that Mr Thomas had said she would be ‘well provided for’. Interestingly, the court heard evidence that when the subject of formal joint ownership of the property was raised, Mr Thomas had been evasive. This was taken to mean that he had no intention of parting with an equitable share in the property. The court also considered that Mr Thomas’s comment that Ms James would be well provided for was a general statement of a beneficial outcome, rather than a commitment to share ownership.
The court ruled that her claim failed, leaving her with only a share in the partnership assets on the dissolution of the business.
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