Unmarried joint owners of property

If you buy a house as a married couple, you would usually own the property jointly. But what happens if you are not married when you buy a house, or if one of you moves into a property owned by someone else? Does this affect how the property is owned?

In English property law there are two classifications of property ownership; legal title and equitable title. Where two or more people jointly own a property, the owners of the legal title are those whose names are registered as the owners of the property i.e. on the deeds/title register. The nature of the equitable ownership of a property, is dependent on how the property is held; either as joint tenants or tenants in common. The importance of how the equitable title to a property is held is often overlooked and underappreciated by buyers and can cause problems when joint owners come to split proceeds of sale, particularly unmarried couples.

If you hold a property under a joint tenancy, the rule of "survivorship" applies. This means that upon the death of one of the joint owners, their share in the property will automatically pass to the surviving joint owner. Under a joint tenancy you are not able to leave your share of the property to anyone else.

If you hold a property as tenants in common, each owner has a declared share in the property which can be equal or by any other split. Each owner is free to leave their share in their will to whoever they wish, and they can also deal with their share in their lifetime as they think fit. If the split is not 50/50, each owners’ distinct shares in the property should be set out in a declaration of trust deed, although this is not always set out at the time of purchase.

If an unmarried couple who own the legal title to the property jointly but their equitable ownership is not expressly set out and the relationship breaks down, a court may have to decide what happens to the property.

The key case in this regard is Stack v Dowden [2007] UKHL 17. In this case an unmarried couple had lived together for many years, had both contributed financially to the purchase price of the property and both were registered legal owners. There was no express declaration of their beneficial interests in the property. Ultimately, the House of Lords decided that the unmarried couple held joint and equal shares in the property as joint tenants, unless a clear contrary intention could be shown. It was found that in order to prove that is not the case, the joint owner seeking to demonstrate that they hold a greater equitable interest in the property, and therefore the property is held as tenants in common, has the burden of proving this intention.

The principle that properties held in joint names legally, will be determined as a legal and beneficial joint tenancy in the absence of any evidence to the contrary, is an important rule that was determined by this judgment and one that solicitors must be aware on when advising their clients on the effect of holding property under a joint tenancy or under a tenancy in common.

When deciding whether the joint tenancy presumption could be displaced by evidence that the intention of the parties was to hold the property as tenants in common, the court looks at the conduct of the parties throughout the whole course of dealings with the property. This includes factors such as the nature of the joint owner’s relationship, whether there are any children (i.e. a responsibility to provide a home), how the property purchase was financed in terms of deposit contributions and the parties arranged their finances  to cover household expenses and outgoings. Where it is absolutely clear that the parties had a different intention to a 50-50 split but it is not clear the actual percentage that they intended, the court will take account of the parties’ whole course of dealings and decide what each is entitled to as a fair share. 

In the more recent case of Rowland v Blades [2021] EWHC 426 (Ch), a separated unmarried couple held a weekend property as legal joint tenants with no express declaration of trust as to the equitable ownership. The High Court applied the principles of Stack v Dowden in that they held the property as joint tenants too. Despite evidence that only one party contributed financially to the purchase, the court held that the parties were entitled to a 50/50 split upon separating as the partner who has contributed all of the money had been given advice from solicitor about the effect of joint tenancy and there was no declaration of trust drawn up as is usually required with a tenancy in common.

There is substantial case law which demonstrates the power of the Stack v Dowden principle and therefore if you are purchasing a property jointly with someone you are not married to, it is crucial that you obtain legal advice on the best way to hold the property based on your intentions, and to prevent the possibility of losing a share of your interest. 

If you require advice on how to hold a property or are involved with a dispute over the entitlement to a property following the breakdown of a relationship, please contact one of our expert lawyers, who will be pleased to assist you.