Marriage is certainly on the decline. Data from the office for national statistics shows that the latest marriage rates are the lowest on record. Couples no longer consider it necessary to marry before they have children or buy property together. But what happens to jointly owned property when couples who are not married separate?
Most people in this situation are surprised to find out that the legislation in England and Wales that governs this situation is completely unrelated to family law and they are not protected by the Matrimonial Causes Act 1973.
The issue between the separating couple would essentially be a dispute over property ownership. Therefore, the legislation that assists is the Trusts of Land and Appointment of Trustees Act 1996 (also known as TOLATA).
What is TOLATA?
TOLATA gives courts certain powers to resolve property disputes between unmarried couples. The court is asked to determine who are the legal and beneficial owners of a property and in what proportions.
A TOLATA claim can be issued to determine:
- whether jointly owned property should be sold
- the respective shares that each co-owner is entitled to
- whether a party has a beneficial interest in the property, usually where that party’s name is not on the legal title and the legal owner is disputing the claim
- whether property subject to a trust of land should be sold on the application of a creditor or a beneficiary such as a parent/grandparent seeking to recover their financial interest in the property
TOLATA limits a court to deciding on co-ownership of property. It does not give the court the power to:
- vary that co-ownership
- adjust the proportions that each person owns
- order that one party sells or transfers their share of the property to the other
- order one trustee to do something that they are not permitted to do under the terms of the trust
- order that one party compulsory purchases the interest of the other party
Who can make an application?
A TOLATA application is usually made by a person who is a co-owner or a person who has a beneficial interest in a property.
Even though these are less common, there are also other parties that can make an application:
- personal representatives of a beneficiary
- trustees in bankruptcy
- judgement creditors with a charging order secured against the property
- receivers
We are here for you
Property Litigator Will Bartley, has discussed what happens when joint-owners no longer wish to jointly own their Property, and what steps can be taken to get it sold in his Property Disputes Q&A Blog here.
If you require any assistance in relation to this topic, please contact us on TOLATAenquiries@porterdodson.co.uk
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